<SUBMISSION>
<ACCESSION-NUMBER>0000950123-02-006939
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>7
<PERIOD>20020628
<ITEMS>2
<ITEMS>7
<FILING-DATE>20020712
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>MASTERCARD INC
<CIK>0001141391
<ASSIGNED-SIC>7389
<IRS-NUMBER>134172551
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>333-67544
<FILM-NUMBER>02701605
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>2000 PURCHASE STREET
<CITY>PURCHASE
<STATE>NY
<ZIP>10577
<PHONE>9142492000
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>2000 PURCHASE STREET
<CITY>PURCHASE
<STATE>NY
<ZIP>10577
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>y62026e8vk.txt
<DESCRIPTION>FORM 8-K
<TEXT>
<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                    FORM 8-K

                                 CURRENT REPORT
     PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


         Date of Report (Date of earliest event reported): June 28, 2002


                             MASTERCARD INCORPORATED
             (Exact name of registrant as specified in its charter)

<TABLE>
<CAPTION>
<S>                                                  <C>                     <C>

                DELAWARE                                  *                  13-4172551
      (State or other jurisdiction                    (Commission            (IRS Employer
           of incorporation)                         File Number)          Identification No.)

        2000 PURCHASE STREET
        PURCHASE, NEW YORK                                          10577
(Address of principal executive offices)                            (Zip Code)
</TABLE>

                                 (914) 249-2000
              (Registrant's telephone number, including area code)

                                 NOT APPLICABLE
          (Former name or former address, if changed since last report)

<PAGE>

Item 2.  Acquisition or Disposition of Assets

         Effective June 28, 2002, MasterCard Incorporated acquired control
of 100% of the shares of Europay International S.A. ("Europay") not previously
owned by MasterCard International Incorporated ("MasterCard International")
pursuant to the Share Exchange and Integration Agreement, dated as of February
13, 2002, entered into by MasterCard Incorporated, MasterCard International and
Europay (the "Integration Agreement"). In connection with the Integration
Agreement, each shareholder of Europay (other than MasterCard International and
MasterCard/Europay U.K. Limited, a company formed by certain financial
institutions in the United Kingdom for the purpose of holding their shares in
Europay ("MEPUK")) was required to enter into a separate share exchange
agreement with MasterCard Incorporated and MasterCard International, pursuant to
which it exchanged its Europay shares for a specified number of shares of class
A redeemable common stock and class B convertible common stock of MasterCard
Incorporated. In addition, the shareholders of MEPUK were required to enter into
an agreement with MasterCard Incorporated and MasterCard International pursuant
to which they exchanged their MEPUK shares for a specified number of shares of
class A redeemable common stock and class B convertible common stock of
MasterCard Incorporated. As a result of this transaction, each of Europay and
MEPUK became a wholly-owned subsidiary of MasterCard Incorporated. MasterCard
International and MEPUK continue to hold shares of Europay.

         Also effective June 28, 2002, pursuant to the Agreement and Plan of
Merger, dated as of February 13, 2002, entered into among MasterCard
Incorporated, MasterCard International and MasterCard Merger Sub, Inc., a
wholly-owned subsidiary of MasterCard Incorporated (the "Merger Agreement"),
MasterCard International and MasterCard Merger Sub, Inc. were merged under
Delaware law with MasterCard International being the surviving entity. Under the
Merger Agreement, each issued and outstanding principal membership interest in
MasterCard International was automatically converted by virtue of the merger
into a class A membership interest of MasterCard International and a specified
number of shares of class A redeemable common stock and class B convertible
common stock of MasterCard Incorporated.

         The issuance of class A redeemable and class B convertible common stock
of MasterCard Incorporated was registered under the Securities Act of 1933
pursuant to MasterCard Incorporated's Post-Effective Amendment No. 2 to its
Registration Statement on Form S-4, Registration No. 333-67544, which was
declared effective on May 8, 2002 (the "Registration Statement"). The proxy
statement-prospectus of MasterCard International contained in the Registration
Statement contains additional information about the transactions described
above. The information in such proxy statement-prospectus contained under the
following captions is included herein as Exhibit 99.1 and is incorporated by
reference into this Item 2:

                  (i)    "The Conversion;"

                  (ii)   "The Integration;"

<PAGE>

                  (iii)  "Share Allocation and the Global Proxy;"

                  (iv)   "Management;"

                  (v)    "Security Ownership of Certain Beneficial Owners and
                         Management;"

                  (vi)   "Certain Relationships and Related Transactions;"

                  (vii)  "Description of Capital Stock of MasterCard
                         Incorporated;" and

                  (viii) "Material Contracts Between MasterCard International
                         and Europay."

        On July 1, 2002, MasterCard International issued a news release
announcing the completion of the above-referenced transactions. A copy of the
news release is included herein as Exhibit 99.2 and is incorporated by
reference into this Item 2.
<PAGE>


Item 7.  Financial Statements and Exhibits.

         (A)  Financial Statements of Business Acquired.

                        The consolidated financial statements of Europay as of
                        December 31, 2001 and 2000 and for each of the three
                        years ended December 31, 2001, 2000 and 1999 are
                        included herein as Exhibit 99.3 and are incorporated by
                        reference into this Item 7.


         (B)  Pro Forma Financial Information.

                        The unaudited pro forma condensed combined financial
                        statements combining the historical consolidated balance
                        sheets and statements of income of MasterCard
                        International and Europay as of and for the year ended
                        December 31, 2001 and giving pro forma effect to the
                        conversion and integration are included herein as
                        Exhibit 99.4 and are incorporated by reference into this
                        Item 7.


         (C)  Exhibits.

               (i)          Exhibit 2.1. Share Exchange and Integration
                            Agreement, dated as of February 13, 2002, by and
                            among MasterCard Incorporated, MasterCard
                            International Incorporated and Europay International
                            S.A. (incorporated by reference to
<PAGE>


                            Annex B to the proxy statement-prospectus in Part I
                            of the Registration Statement defined herein).

               (ii)         Exhibit 2.2. Form of Share Exchange Agreement to be
                            entered among MasterCard Incorporated, MasterCard
                            International Incorporated and each shareholder of
                            Europay International S.A. other than MEPUK and
                            MasterCard International Incorporated (incorporated
                            by reference to Annex C to the proxy
                            statement-prospectus in Part I of the Registration
                            Statement defined herein).

               (iii)        Exhibit 2.3. Agreement and Plan of Merger, dated as
                            of February 13, 2002, by and among MasterCard
                            International Incorporated, MasterCard Incorporated
                            and MasterCard Merger Sub, Inc. (incorporated by
                            reference to Annex A to the proxy
                            statement-prospectus in Part I of the Registration
                            Statement defined herein).

               (iv)         Exhibit 2.4. Form of Share Exchange Agreement to be
                            entered among MasterCard Incorporated and each
                            shareholder of MasterCard/Europay U.K. Limited
                            (incorporated by reference to Exhibit 2.4 of the
                            Registration Statement defined herein).

               (v)          Exhibit 4.1. Amended and Restated Certificate of
                            Incorporation of MasterCard Incorporated.

               (vi)         Exhibit 4.2. Amended and Restated Bylaws of
                            MasterCard Incorporated.

               (vii)        Exhibit 4.3. Form of Specimen Certificate for Class
                            A Redeemable Common Stock of MasterCard Incorporated
                            (incorporated by reference to Exhibit 4.1 of the
                            Registration Statement defined herein).

               (viii)       Exhibit 4.4. Form of Specimen Certificate for Class
                            B Convertible Common Stock of MasterCard
                            Incorporated (incorporated by reference to Exhibit
                            4.2 of the Registration Statement defined herein).

               (ix)         Exhibit 99.1. Portions of the proxy
                            statement-prospectus contained in the Registration
                            Statement defined herein.

               (x)          Exhibit 99.2. News Release, dated July 1, 2002, of
                            MasterCard International.
<PAGE>

               (xi)         Exhibit 99.3. Consolidated financial statements of
                            Europay as of December 31, 2001 and 2000 and for
                            each of the three years in the periods ended
                            December 31, 2001, 2000 and 1999.

               (xii)        Exhibit 99.4. Unaudited pro forma condensed combined
                            financial statements of MasterCard International and
                            Europay as of and for the year ended December 31,
                            2001 and giving pro forma effect to the conversion
                            and integration.
<PAGE>


                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                                  MASTERCARD INCORPORATED

Date: July 12, 2002                               By: /s/ ROBERT W. SELANDER
                                                      --------------------------
                                                      President and Chief
                                                      Executive Officer
<PAGE>

                                  EXHIBIT INDEX
<TABLE>
<CAPTION>
              EXHIBIT
              NUMBER        EXHIBIT DESCRIPTION

<S>                         <C>
               2.1          Share Exchange and Integration Agreement, dated as
                            of February 13, 2002, by and among MasterCard
                            Incorporated, MasterCard International Incorporated
                            and Europay International S.A. (incorporated by
                            reference to Annex B to the proxy
                            statement-prospectus in Part I of the Registration
                            Statement defined herein).

               2.2          Form of Share Exchange Agreement to be entered among
                            MasterCard Incorporated, MasterCard International
                            Incorporated and each shareholder of Europay
                            International S.A. other than MEPUK and MasterCard
                            International Incorporated (incorporated by
                            reference to Annex C to the proxy
                            statement-prospectus in Part I of the Registration
                            Statement defined herein).

               2.3          Agreement and Plan of Merger, dated as of February
                            13, 2002, by and among MasterCard International
                            Incorporated, MasterCard Incorporated and MasterCard
                            Merger Sub, Inc. (incorporated by reference to Annex
                            A to the proxy statement-prospectus in Part I of the
                            Registration Statement defined herein).

               2.4          Form of Share Exchange Agreement to be entered among
                            MasterCard Incorporated and each shareholder of
                            MasterCard/Europay U.K. Limited (incorporated by
                            reference to Exhibit 2.4 of the Registration
                            Statement defined herein).

               4.1          Amended and Restated Certificate of Incorporation of
                            MasterCard Incorporated.

               4.2          Amended and Restated Bylaws of MasterCard
                            Incorporated.

               4.3          Form of Specimen Certificate for Class A Redeemable
                            Common Stock of MasterCard Incorporated
                            (incorporated by reference to Exhibit 4.1 of the
                            Registration Statement defined herein).

               4.4          Form of Specimen Certificate for Class B Convertible
                            Common Stock of MasterCard Incorporated
                            (incorporated by reference to Exhibit 4.2 of the
                            Registration Statement defined herein).

</TABLE>
<PAGE>

<TABLE>
<CAPTION>
<S>                         <C>
               99.1         Portions of the proxy statement-prospectus contained
                            in the Registration Statement defined herein.

               99.2         News Release, dated July 1, 2002, of MasterCard
                            International.

               99.3         Consolidated financial statements of Europay as of
                            December 31, 2001 and 2000 and for each of the three
                            years in the periods ended December 31, 2001, 2000
                            and 1999.

               99.4         Unaudited pro forma condensed combined financial
                            statements of MasterCard International and Europay
                            as of and for the year ended December 31, 2001 and
                            giving pro forma effect to the conversion and
                            integration.

</TABLE>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>3
<FILENAME>y62026exv4w1.txt
<DESCRIPTION>AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
<TEXT>
<PAGE>
                                                                     Exhibit 4.1




                              AMENDED AND RESTATED
                          CERTIFICATE OF INCORPORATION
                                       OF
                             MASTERCARD INCORPORATED


         THE UNDERSIGNED, for the purpose of forming a corporation pursuant to
Section 102 of the Delaware General Corporation Law (the "DGCL"), does hereby
certify the following:

         FIRST: The name of the corporation is MasterCard Incorporated (the
"Corporation").

         SECOND: The address of the registered office of the Corporation in the
State of Delaware is 100 West Tenth Street, City of Wilmington, County of New
Castle, and the name of the registered agent of the Corporation in the State of
Delaware at that address is The Corporation Trust Company.

         THIRD: The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the DGCL.

         FOURTH: The name and mailing address of the Sole Incorporator is Noah
J. Hanft, 2000 Purchase Street, Purchase, New York 10577.

         FIFTH: The Corporation shall have the authority to issue shares of
common stock, $.01 par value per share, in three classes, all of which shall be
nonassessable: Class A Common Stock ("Class A Stock"), Class B Common Stock
("Class B Stock") and Class C Common Stock ("Class C Stock" and, together with
the Class A Stock and the Class B Stock, the "Common Stock"). The number of
shares of Class A Stock that the Corporation may issue is limited to 275
million. The number of shares of Class B Stock that the Corporation may issue is
limited to 25 million. The number of shares of Class C Stock that the
Corporation may issue is limited to 75 million.

                  1. Class A Stock and Class B Stock. The Class A Stock and the
Class B Stock and the holders thereof shall have the rights, preferences and
privileges and be subject to the restrictions set forth below.

                  a. The shares of Class A Stock and the shares of Class B Stock
shall participate equally in any dividends declared by the Corporation's board
of directors (the "Board").

                  b. (i) Each share of Class B Stock (other than a share of
Class B Stock that constitutes a share of "ec Picto Stock," as that term is
defined in the Share Exchange and Integration Agreement, dated as of February
13, 2002, by and among the Corporation, MasterCard International Incorporated
("MCI") and Europay International S.A. (as amended, modified, supplemented or
restated from time to time, the "Integration Agreement")) shall automatically be
converted into one share of Class A Stock, without further action by the
Corporation or the holder of the share, at the close of business New York City
time, on the Transition Date (as defined in the Integration Agreement);
provided, however, that if such date is not a day on which banks in New York
City are open for business, then the conversion shall take place at the close of
business, New York City time, on the next date on which banks in New York City
are open for business (the "First Conversion Date"). Each share of ec Picto
Stock shall automatically be converted into one share of Class A Stock at the
close of business, New York City time, on the second anniversary of the First
Conversion Date; provided, however, that if such date is not a day on which
banks in New York City are open for business, then the conversion shall take
place at the close of business, New York City time, on the next date on which
banks in New York City are open for business.
<PAGE>
                  (ii) The Corporation shall at all times reserve and keep
available out of its authorized but unissued shares of Class A Stock solely for
the purpose of effecting the conversion of Class B Stock such number of shares
of Class A Stock as shall from time to time be sufficient to effect the
conversion of all outstanding shares of Class B Stock.

                  (iii) Upon the conversion of any shares of Class B Stock, the
shares of Class B Stock so converted shall be cancelled and shall no longer be
issuable by the Corporation.

                  c. (i) Except as otherwise provided in this paragraph, the
holders of Class A Stock shall have the right to one vote for each share of
Class A Stock held by them and, prior to and including the Transition Date, the
holders of Class B Stock shall have the right to one vote for each share of
Class B Stock held by them. The Class B Stock shall have no voting rights
following the Transition Date.

                  (ii) In any vote for the election of directors of the
Corporation, no holder of capital stock eligible to be voted in that election,
together with its Affiliates (as defined below), shall be entitled to exercise
voting power in excess of 7% (the "Percentage Voting Limitation") of the
outstanding shares of capital stock entitled to be voted in that election. At
any time following the Transition Date, either the Board, by the affirmative
vote of not less than a majority of the entire Board, or the stockholders, by a
resolution approved by the affirmative vote of the holders of not less than a
majority of the outstanding shares of Class A Stock, may amend, modify or delete
the Percentage Voting Limitation; provided, however, that the affirmative vote
of at least 75% of the members of the Board present at a meeting at which a
quorum is present shall be required to increase the Percentage Voting Limitation
to an amount greater than 15%. This paragraph (1)(c)(ii) of Article FIFTH shall
not be amended, modified or deleted without the approval of at least 75% of the
members of the Board present at a meeting at which a quorum is present and the
approval of at least a majority of the outstanding shares of Class A Stock (or,
prior to and including the Transition Date, the holders of not less than a
majority of the outstanding shares of Class A Stock and of Class B Stock, voting
together as a single class). The term "Affiliate", as used in this Certificate
of Incorporation, shall mean any direct or indirect parent entity of the holders
of Class A Stock (or, prior to and including the Transition Date, the holders of
Class A Stock and/or Class B Stock), and any direct or indirect majority-owned
subsidiary of any such holder or any of its parents.

                  d. The Corporation shall not issue any Class B Stock except in
accordance with the provisions of Sections 1.1, 1.2, 1.3 and 1.4 of the
Integration Agreement.

                  e. Shares of Class A Stock and Class B Stock may be redeemed
by the Corporation in order to effectuate any reallocation of shares among the
stockholders in accordance with Sections 1.3 and 1.4 of the Integration
Agreement.

               2. Class C Stock. The Class C Stock may be issued from time to
time in one or more series, each of which will have such voting powers (or no
voting powers), designations, preferences and relative, participating, optional
or other special rights, and qualifications or restrictions of those powers,
preferences or rights, as are stated in the resolution or resolutions of the
Board providing for the issuance of the series; provided, however, that in no
event shall any shares of Class C Stock be entitled to voting rights, rights to
dividends or rights to participate in a liquidation that are greater than the
corresponding rights of the Class A Stock. The rights which the Board may (but
will not be required to) give to the holders of one or more series of Class C
Stock will include, but not be limited to, (a) the right to receive dividends at
such rates, on such conditions and at such times, as may be stated in the
resolution or resolutions providing for the issuance of the series, (b) such
rights upon the dissolution of the Corporation as may be stated in the
resolution or resolutions providing for the issuance of the series and


                                       2
<PAGE>
(c) such rights to convert shares of the series into, or exchange shares of the
series for, shares of any other class or classes or any other series of the same
or any other class of stock of the Corporation, as may be stated in the
resolution or resolutions providing for the issuance of the series.

         SIXTH: The Corporation shall not, without first obtaining (i) the
approval of at least 75% of the members of the Board present at a meeting at
which a quorum is present and (ii) the approval of the holders of not less than
a majority of the outstanding shares of Class A Stock (or, prior to and
including the Transition Date, the holders of not less than a majority of the
outstanding shares of Class A Stock and Class B Stock, voting together as a
single class):

                  a. (i) alter the Corporation's status as a stock corporation;
(ii) amend this Certificate of Incorporation to authorize the Corporation to
issue any stock other than Class A Stock, Class B Stock or Class C Stock; (iii)
sell, lease or exchange all or substantially all of the assets of the
Corporation or approve the sale, lease or exchange of all or substantially all
of the assets of MCI; (iii) consummate any merger or consolidation of the
Corporation or MCI with another corporation; or (iv) undertake an initial public
offering of any class of the Corporation's equity securities;

                  b. in its capacity as the Class B member of MCI, consent to
any proposed amendment to (i) Article FIFTH of the certificate of incorporation
of MCI as in effect from and after June 28, 2002, (ii) Article SEVENTH of the
certificate of incorporation of MCI as in effect from and after June 28, 2002,
(iii) Article NINTH, Section (b) of the certificate of incorporation of MCI as
in effect from and after June 28, 2002 or (iv) Article VI, Section 4(b) of the
bylaws of MCI as in effect from and after June 28, 2002; or

                  c. amend, modify or delete this Article SIXTH.

         SEVENTH: The Corporation shall not:

                  a. issue shares of Class C Stock without first obtaining the
approval of at least two-thirds of the members of the Board present at a meeting
at which a quorum is present; provided, however, that if an issuance of shares
of Class C Stock, when taken together with all other issuances of shares of
Class C Stock made during the immediately preceding two years, represent greater
than 5% of the number of shares of Class A Stock and Class B Stock outstanding
before giving effect to that issuance, then the issuance of Class C Stock shall
not be made without the prior approval of at least 75% of the members of the
Board present at a meeting at which a quorum is present; provided, further, that
the affirmative vote of at least 75% of the members of the Board present at a
meeting at which a quorum is present shall be required to issue any shares of
Class C Stock with voting rights;

                  b. permit any stockholder of the Corporation (together with
its Affiliates) to own shares of capital stock representing more than 15% of the
outstanding shares of voting stock of the Corporation without the approval of at
least two-thirds of the members of the Board present at a meeting at which a
quorum is present;

                  c. amend, modify or delete clause (a) of this Article SEVENTH
and this clause (c) without the approval of at least 75% of the members of the
Board present at a meeting at which a quorum is present and the approval of the
holders of not less than a majority of the outstanding shares of Class A Stock
(or, prior to and including the Transition Date, the holders of not less than a
majority of the outstanding shares of Class A Stock and Class B Stock, voting
together as a single class); or

                  d. amend, modify or delete clause (b) of this Article SEVENTH
and this clause (d) without the approval of at least two-thirds of the members
of the Board present at a meeting at which a quorum is present and the approval
of the holders of not less than a majority of the outstanding shares of Class A
Stock (or, prior to and including the Transition Date, the holders of not less
than a majority of the outstanding


                                       3
<PAGE>
shares of Class A Stock (or, prior to and including the Transaction Date, the
holders of not less than a majority of the outstanding shares of Class A Stock
and Class B Stock, voting together as a single class).

         EIGHTH: Unless the Board by the affirmative vote of at least 75% of its
members present at a meeting at which a quorum is present decides otherwise, (i)
in addition to the eligibility criteria for directors of the Corporation set
forth in the Bylaws of the Corporation as in effect from and after June 28,
2002, no more than one-third of the number of members of the Board shall consist
of persons who are directors, officers or employees of, or consultants to,
stockholders designated as being part of a particular region of the Corporation;
and (ii) the Corporation shall not amend Section 2 of Article III of the Bylaws
of the Corporation as in effect from and after June 28, 2002. This Article
EIGHTH shall not be amended, modified or deleted without the approval of at
least 75% of the members of the Board present at a meeting at which a quorum is
present and the approval of the holders of not less than a majority of the
outstanding shares of Class A Stock (or, prior to and including the Transition
Date, the holders of not less than a majority of the outstanding shares of Class
A Stock and Class B Stock, voting together as a single class).

         NINTH: In furtherance and not in limitation of the powers conferred by
statute, the Board is expressly authorized to make, alter or repeal the bylaws
of the Corporation.

         TENTH: No director will have any personal liability to the Corporation
or its members for monetary damages for any breach of fiduciary duty as a
director, except (i) for any breach of the director's duty of loyalty to the
Corporation, (ii) for acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law, (iii) under Section 174 of
the DGCL or (iv) for any transaction from which the director obtained an
improper personal benefit.

         ELEVENTH: Pursuant to Section 211(e) of the DGCL, directors shall not
be required to be elected by written ballot.

         IN WITNESS WHEREOF, MasterCard Incorporated has caused this Amended and
Restated Certificate of Incorporation to be signed by its President and Chief
Executive Officer, and its corporate seal to be hereunto affixed and attested by
its Secretary, this 28th day of June, 2002.



                                          MASTERCARD INCORPORATED


                                          By: /s/ Robert W. Selander
                                             -----------------------------
                                             Name:   Robert W. Selander
                                             Title:  President and Chief
                                                     Executive Officer


                                       4




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.2
<SEQUENCE>4
<FILENAME>y62026exv4w2.txt
<DESCRIPTION>AMENDED AND RESTATED BYLAWS
<TEXT>
<PAGE>
                                                                     Exhibit 4.2




                              AMENDED AND RESTATED

                                     BYLAWS

                                       OF

                             MASTERCARD INCORPORATED

                             A DELAWARE CORPORATION

                              ADOPTED JUNE 28, 2002


                                   ARTICLE I

                                     Offices

         Section 1. The registered office of the Corporation shall be in the
City of Wilmington, County of New Castle, State of Delaware. The Corporation may
also have offices at such other places, within or outside of the State of
Delaware, as the Board of Directors may from time to time determine or the
business of the Corporation may require.

                                   ARTICLE II

                            Meetings of Stockholders

         Section 1. All meetings of stockholders shall be held at the registered
office of the Corporation, or at such other place within or outside of the State
of Delaware as may be fixed from time to time by the Board of Directors.

         Section 2. Annual meetings of stockholders shall be held at such date
and time as may be fixed by the Board of Directors, at the offices of the
Corporation, or at such other date and time as may be fixed by the Board of
Directors. At each annual meeting of stockholders, the stockholders shall elect
Directors and transact such other business as may properly be brought before the
meeting.

         Section 3. Written notice of each annual meeting of stockholders,
stating the place, date and hour of the meeting, as well as the means of
acceptable remote participation, shall be given in the manner set forth in
ARTICLE XV of these Bylaws. Such notice shall be given not less than 10 nor more
than 60 days before the date of the meeting to each stockholder entitled to vote
at the meeting.

         Section 4. Special meetings of stockholders may be called at any time
for any purpose or purposes by written request of the Chairman of the Board of
Directors or the President and Chief Executive Officer of the Corporation, or by
the Secretary of the Corporation upon the written request of at least 33 1/3% of
the Board of Directors, or upon the written request of the holders of at least
25% of all outstanding shares entitled to vote on the action proposed to be
taken. Such written requests shall state the time, place and purpose or purposes
of the special meeting, the person or persons calling the special meeting and
that the special meeting so called shall be limited to the purpose or purposes
set forth in the demand.
<PAGE>
         Section 5. Written notice of each special meeting of stockholders shall
be given in the manner set forth in ARTICLE XV of these Bylaws. Such notice
shall be given not less than 10 nor more than 60 days before the date of the
meeting to each stockholder entitled to vote at the meeting. Each such notice of
a special meeting of stockholders shall state the place, date and hour of a
meeting, the person or persons calling the meeting and the purpose or purposes
for which the meeting is called, as well as the means, if any, of acceptable
remote participation as may be determined by the Board of Directors.

         Section 6. Except as otherwise required by law or the Certificate of
Incorporation, the presence in person or by proxy of holders of at least a
majority of the shares entitled to vote at a meeting of stockholders shall be
necessary, and shall constitute a quorum, for the transaction of business at
such meeting. If a quorum is not present or represented by proxy at any meeting
of stockholders, then the holders of a majority of the shares entitled to vote
at the meeting who are present in person or represented by proxy may adjourn the
meeting from time to time until a quorum is present. An adjourned meeting may be
held later without notice other than announcement at the meeting, except that if
the adjournment is for more than 30 days, or if after the adjournment a new
record date is fixed for the adjourned meeting, notice of the adjourned meeting
shall be given in the manner set forth in ARTICLE XV to each stockholder of
record entitled to vote at the adjourned meeting. The stockholders present at a
duly organized meeting may continue to transact business until adjournment, and
the subsequent withdrawal of any stockholder or the refusal of any stockholder
to vote shall not affect the presence of a quorum at the meeting.

         Section 7. At any meeting of stockholders, each stockholder having the
right to vote shall be entitled to vote in person, by proxy or by such means, if
any, of remote communication as may be determined by the Board of Directors.
Except as otherwise provided by law or in the Certificate of Incorporation or
these Bylaws, each stockholder shall be entitled to one vote for each share of
stock entitled to vote standing in his name on the books of the Corporation.
Except as otherwise provided by law or in the Certificate of Incorporation, any
matter shall be determined by the vote of a majority of the shares that are
voted with regard to it at a meeting where a valid quorum is present, subject to
any limitations of the voting power of stockholders imposed by the terms of the
Certificate of Incorporation.

         Section 8. Any action required or permitted to be taken by the
stockholders at any annual or special meeting of the stockholders may be taken
without a meeting, without prior notice and without a vote, if a consent or
consents in writing shall be signed by the holders of outstanding stock having
not less than the minimum number of votes that would be necessary to authorize
or take such action at a meeting at which all shares entitled to vote thereon
were present and voted, and shall be delivered to the Corporation by delivery to
its registered office in Delaware, its principal place of business or an officer
or agent of the Corporation having custody of the book in which proceedings of
meetings of stockholders are recorded. Delivery made to the Corporation's
registered office shall be by hand or by registered or certified mail, return
receipt requested.

         Section 9. The Board of Directors may fix a date as the record date for
determination of the stockholders entitled (i) to notice of, or to vote at, any
meeting of stockholders, (ii) to express consent to, or dissent from, corporate
action in writing without a meeting or (iii) to receive payment of any dividend
or other distribution or allotment of any rights or to take or be the subject of
any other action. The record date must be on or after the date on which the
Board of Directors adopts the resolution fixing the record date and in the case
of (i), above, must be not less than 10 nor more than 60 days before the date of
the meeting, in the case of (ii), above, must be not more than 10 days after the
date on which the Board of Directors fixes the record date, and in the case of
(iii), above, must be not more than 60 days prior to the proposed action. If no
record date is fixed, then the record date will be as provided by law. A
determination of stockholders entitled to notice of, or to vote at, any meeting
of


                                       2
<PAGE>
stockholders that has been made as provided in this Section will apply to any
adjournment of the meeting, unless the Board of Directors fixes a new record
date for the adjourned meeting.

                                  ARTICLE III

                                 Share Ownership

         Section 1. As of the close of business, New York time, on the last day
of the three-year period (the "Transition Period") beginning on the first
business day of the fiscal quarter following the Closing Date (as defined in the
Share Exchange and Integration Agreement by and among the Corporation,
MasterCard International Incorporated and Europay International S.A., dated as
of February 13, 2002, (as amended, modified, supplemented or restated from time
to time, the "Integration Agreement")), each outstanding share of Class B Common
Stock of the Corporation, $.01 par value per share (a "Class B share"), other
than any Class B shares that constitute ec Picto Stock (as defined in the
Integration Agreement), shall automatically be converted into one share of Class
A Common Stock of the Corporation, $.01 par value per share (a "Class A share").
All Class A shares shall then be reallocated among the holders of Class A shares
in accordance with the terms and subject to the conditions set forth in Sections
1.4(b) and 1.4(d) of the Integration Agreement. In connection with any
reallocation of Class A shares, any stockholder whose ownership of Class A
shares is reduced as a result of the reallocation will transfer the excess
number of Class A shares to the Corporation, which shall then deliver Class A
shares to any stockholder that is entitled to an additional number of Class A
shares as a result of the reallocation.

         Section 2. For purposes of these Bylaws, the Global Proxy Calculation
shall be calculated for each successive 12-month period beginning on the first
day of the Transition Period; provided, however, that for Global Proxy
Calculations for periods ending after the second anniversary of the end of the
Transition Period, the Board of Directors may elect to use the Corporation's
fiscal year as the basis for the Global Proxy Calculation. The Global Proxy
Calculation for each stockholder of MasterCard International Incorporated shall
be equal to the sum obtained by adding (A) .25 multiplied by a fraction, the
numerator of which is such stockholder's Gross Dollar Volume (GDV) and the
denominator of which is the Corporation's Gross Dollar Volume (GDV) attributable
to all stockholders of the Corporation, plus (B) .25 multiplied by a fraction,
the numerator of which is such stockholder's Gross Acquiring Volume (GAV) and
the denominator of which is the Corporation's Gross Acquiring Volume (GAV)
attributable to all stockholders of the Corporation, plus (C) .50 multiplied by
a fraction, the numerator of which is the sum of (1) the Revenues Paid by such
stockholder to the Corporation and its consolidated subsidiaries relating to all
matters other than travelers cheque programs, plus (2) two times the Revenues
Paid by the stockholder to the Corporation and its consolidated subsidiaries
relating to travelers cheque programs, and the denominator of which is the sum
of (1) the Revenues Paid by all stockholders to the Corporation and its
consolidated subsidiaries relating to all matters other than travelers cheque
programs, plus (2) two times the Revenues Paid by all stockholders to the
Corporation and its consolidated subsidiaries relating to travelers cheque
programs, in each case for the applicable period. No Gross Dollar Volume (GDV)
or Gross Acquiring Volume (GAV) shall be attributable to travelers cheque
programs for purposes of the Global Proxy Calculation. The Board of Directors
may fix a record date for the purposes of determining those stockholders of
record whose Gross Dollar Volume (GDV), Gross Acquiring Volume (GAV) and
Revenues Paid shall be included in determining a Global Proxy Calculation for a
particular period, which record date shall not be more than 30 days prior to the
end of any such period. Only actual, as opposed to estimated, Gross Dollar
Volume (GDV) and Gross Acquiring Volume (GAV) and Revenues Paid information will
be used in determining the Global Proxy Calculation for each stockholder.


                                       3
<PAGE>
The Corporation, acting through relevant employees selected by the Chief
Executive Officer from time to time, shall compute the Global Proxy Calculation
for each stockholder for each applicable 12 month period and provide written
notice to each stockholder of the results of such computation within 120 days
after the end of the 12-month period to which the computation relates. The
Corporation's computation of the Global Proxy Calculation shall be considered
final and binding on all stockholders unless the Board of Directors determines
that an error was made in the computation, in which case the Corporation's
computation shall be corrected in accordance with the directions of the Board of
Directors.

"Gross Dollar Volume" means processed and non-processed issued Volumes
(including domestic and international retail purchases, cash transactions,
convenience checks, on-us transactions, intra-processor transactions, local use
only transactions and balance and commercial funds transfers) that occur as a
result of one or more of (A) a transaction involving any one of the
Corporation's brands (e.g., MasterCard(R), Eurocard(R), Maestro(R), Cirrus(R)
and ec Picto(R)) or (B) a non-MasterCard branded transaction involving a card
which includes any one of the Corporation's brand logos as well as other payment
brand logos, provided that such other payment brands are not in direct
competition with any of the Corporation's brands, as determined by the
Corporation.

"Gross Acquiring Volume" means processed and non-processed acquired Volumes
(including domestic and international retail purchases, cash transactions, on-us
transactions, intra-processor transactions and local use only transactions) that
occur as a result of one or more of (A) a transaction involving any one of the
Corporation's brands (e.g., MasterCard(R), Eurocard(R), Maestro(R), Cirrus(R)
and ec Picto(R)) or (B) a non-MasterCard branded transaction involving a card
which includes any one of the Corporation's brand logos as well as other payment
brand logos, provided that such other payment brands are not in direct
competition with any of the Corporation's brands, as determined by the
Corporation.

"Revenues Paid" for any period means, with respect to a particular stockholder,
all revenues of the Corporation on a consolidated basis, calculated in
accordance with U.S. GAAP, that are generated by the activities of that
stockholder, other than (1) any fees or other charges associated with the
termination of that stockholder's membership in MasterCard International
Incorporated, (2) Integration Assessments (as defined in Section 4(d) of Article
VI of the Bylaws of MasterCard International Incorporated) paid by that
stockholder, (3) other assessments, fees and charges paid by that stockholder in
its capacity as a member of MasterCard International Incorporated if those
assessments, fees or charges were imposed on less than all of the members of
MasterCard International Incorporated (except for assessments, fees and charges
pertaining to business development, ordinary course of business and other
matters deemed to be includable by the management of MasterCard International
Incorporated in its sole discretion) and (4) fines and penalties paid by that
stockholder (except as determined in the sole discretion of the management of
MasterCard International Incorporated).

"card fee assessment" means a bona fide, non de minimis fee expressed as a fixed
amount in connection with a card.

"volume-based assessment" means a bona fide, non de minimis assessment typically
expressed as a percentage of the Gross Dollar Volume (GDV) or Gross Acquiring
Volume (GAV) associated with a particular type of transaction.

"Volumes" means the following four types of volumes in the specified
percentages:

         a. Type 1 shall include 100% of all (1) volumes on cards that include a
MasterCard(R) brand logo and that are subject to volume-based assessments or
card fee assessments, (2) Maestro(R) and Cirrus(R) processed debit volumes and
(3) Maestro(R) and Cirrus(R) debit volumes that are


                                       4
<PAGE>
subject to volume-based assessments, so long as Maestro(R), a Permitted Purse
Brand and/or Cirrus(R) is the sole acceptance brand on the card.

         b. Type 1A shall include 75% of all ec Picto(R) volumes and other
similar debit volumes that in each case have been converted to Maestro(R)
volumes so long as Maestro(R), a Permitted Purse Brand and/or Cirrus(R) is the
sole acceptance brand on the card and the card is subject to card fee
assessments.

         c. Type 2 shall include the following percentages of all volumes for
regional debit brands owned (or in the case of the initial allocation of shares
to be owned) solely by the Corporation on cards that include a Maestro(R) and/or
Cirrus(R) logo; provided that such cards are subject to volume-based assessments
or card fee assessments; and provided, further, that for calculations for the
last year of the Transition Period through the year ending on the second
anniversary of the end of the Transition Period, there is a binding written
commitment to remove all acceptance brand logos, other than the Maestro(R) brand
logo, the Cirrus(R) brand logo or a Permitted Purse Brand logo, on the cards not
later than the fifth anniversary of the first fiscal quarter beginning after the
fiscal quarter in which the Closing Date occurs:

                  (i) 40% of such volumes for the last year of the Transition
Period;

                  (ii) 30% of such volumes for the year ending on the one-year
anniversary of the end of the Transition Period;

                  (iii) 20% of such volumes for the year ending on the two-year
anniversary of the end of the Transition Period; and

                  (iv) 10% of such volumes for subsequent years.

         d. Type 3 shall include 1% of (i) volumes for regional debit brands not
owned by the Corporation on cards that include a Maestro(R) and/or Cirrus(R)
brand logo and are subject to volume-based assessments or card fee assessments
and (ii) volumes for balance and commercial funds transfers relating to cards
that are subject to volume-based assessments or card fee assessments.

In determining the proportionate share of each stockholder of Europe of (i) the
European Regional Proxy Amount (as defined in the Integration Agreement) for
purposes of the reallocation contemplated by Section 1.3 of the Integration
Agreement and (ii) the European Regional Proxy Amount for each year of the
Transition Period other than the last year of the Transition Period, ec Picto(R)
Volumes shall be accorded a weighting of 10% (unless those volumes satisfy the
criteria of Type 1A or Type 2 Volumes, in which case those volumes shall be
accorded the weighting contemplated by those Types, as appropriate). Thereafter,
ec Picto(R) Volumes shall be accorded the weighting determined in accordance
with the definitions of the Types of Volumes described above.

For each Global Proxy Calculation, all Volumes described above will be included
in calculating Gross Dollar Volume and Gross Acquiring Volume whether those
Volumes are assessed directly or the cards to which they relate are subject to
card fee assessments of the type contemplated by the applicable type of Volume.
In addition, for each Global Proxy Calculation performed prior to the expiration
of the Transition Period, Volumes of the types described above will be included
even if they are not subject to volume-based or card fee assessments.


                                       5
<PAGE>
"Permitted Purse Brand" means a brand representing a stored value application
that is permitted to be used by members of MasterCard International Incorporated
under the Bylaws and Rules of MasterCard International Incorporated.

For purposes of determining the Global Proxy Calculation, the conversion of
Euros into U.S. dollars will be based on the average exchange rate during the
twenty-day period ending on the day prior to the applicable measurement date
(the "Prevailing Exchange Rate"), provided that during the Transition Period and
for two years thereafter, the Prevailing Exchange Rate shall be $.9565 U.S. = 1
Euro for so long as 1 Euro is not less than $.9065 U.S. and not greater than
$1.0065 U.S. (the "Currency Conversion Band"). In the event that the Prevailing
Exchange Rate does not fall within the Currency Conversion Band, the currency
conversion rate to convert Euros to U.S. Dollars will be $.9565 adjusted by the
difference between such Prevailing Exchange Rate and the upper/lower limit of
the Currency Conversion Band, as applicable.

For purposes of determining the Global Proxy Calculation during the Transition
Period and for the two years thereafter, amounts denominated in the currency of
a country within the Europe Region (as defined in the Integration Agreement)
other than the Euro shall be converted into Euros and subsequently converted
into U.S. dollars in accordance with the previous paragraph.

Class A shares and Class B shares may be held only by Class A members of
MasterCard International Incorporated and, with the prior approval of the Board
of Directors, their Designated Affiliates. A Designated Affiliate of a Class A
member is an Affiliate (as defined in the Certificate of Incorporation) of the
Class A member to whom the Class A member transfers its stock in the Corporation
in order to satisfy applicable regulatory requirements that prohibit the Class A
member from holding stock in the Corporation.

No fractional shares of Class A Stock or Class B Stock shall be issued or
delivered by the Corporation, and any fractional share interests shall be
rounded in such manner as the management of the Corporation shall determine in
its sole discretion.

         Section 3. During the Transition Period, no shares may be sold,
transferred, pledged, hypothecated or assigned (including any assignment of the
right to receive shares) except that (i) a stockholder may sell, transfer,
pledge, hypothecate or assign (including any assignment of the right to receive
shares), as applicable, all, but not less than all, of its shares to the
acquirer of its card portfolio in connection with a transfer by a stockholder of
all or substantially all of such stockholder's card portfolio, (ii) if a
stockholder that was a principal member becomes an affiliate member of another
principal member, such stockholder may sell, transfer, pledge, hypothecate or
assign (including any assignment of the right to receive shares), as applicable,
all, but not less than all, of its shares to the principal member with whom it
becomes affiliated, (iii) if a stockholder that was a principal member and had
one or more affiliate members ceases to be a principal member and one or more of
its affiliate members thereupon become principal members, such stockholder may
sell, transfer, hypothecate or assign (including any assignment of the right to
receive shares), as applicable, all, but not less than all, of its shares to
such former affiliate members, (iv) if a stockholder is prohibited by applicable
regulatory requirements from holding stock in the Corporation, such stockholder
may sell transfer, pledge, hypothecate or assign (including any assignment of
the right to receive shares), as applicable, all, but not less than all, of its
shares to a Designated Affiliate so long as the Board of Directors has given its
prior approval to the transaction; and (v) a stockholder may sell, transfer,
pledge, hypothecate or assign (including any assignment of the right to receive
shares), as applicable, all, but not less than all, of its shares to a Class A
member that is an affiliate of such stockholder so long as the Board of
Directors has given its prior approval to the transaction; provided, however
that for the purposes of this clause (v), the term "affiliate" shall be deemed
to mean any parent company that directly or indirectly owns 80% or


                                       6
<PAGE>
more of the voting power and economic interests in such stockholder, and any
entity of which such stockholder or any of such parents owns 80% or more of the
voting power and economic interests. If, during the Transition Period, a
stockholder ceases to be a member of MasterCard International Incorporated
(voluntarily or otherwise), such stockholder's shares in the Corporation shall
be transferred to the Corporation from such stockholder at a cost to the
Corporation equal to the aggregate par value of the shares transferred to the
Corporation, effective as of the first business day after the date such
stockholder's membership in MasterCard International Incorporated was
terminated. If, following the expiration of the Transition Period, a stockholder
ceases to be a member of MasterCard International Incorporated (voluntarily or
otherwise), the Corporation shall have the right, in its sole discretion, to
elect to direct such stockholder to transfer to the Corporation for cash all of
such stockholder's shares for an amount equal to the book value of such
stockholder's shares based on the Corporation's financial statements most
recently filed with the U.S. Securities and Exchange Commission. The Corporation
shall make such election by delivering a written notice to such stockholder
within 20 days after such stockholder's membership in MasterCard International
Incorporated was terminated. If the Corporation makes such election, then the
Corporation shall deliver the payment price in cash to such stockholder within
20 days after delivering its written election notice. Upon delivery of the
payment price, all of such stockholder's rights as a stockholder of the
Corporation shall immediately cease. In the event that the Corporation does not
make such election, such stockholder will be required to comply with the
procedures set forth in Section 4.

         Section 4. An entity that became or becomes a Class A member of
MasterCard International Incorporated from and after January 1, 2001 until the
end of the Transition Period shall be eligible to be allocated Class A shares as
of the end of the Transition Period based upon its Global Proxy Calculation in
accordance with such procedures as may be determined by the Board. From and
after the end of the Transition Period, each stockholder shall be free to sell,
transfer, pledge, hypothecate or assign (including any assignment of the right
to receive shares), as applicable, its shares to any person permitted to hold
such shares. Following the expiration of the Transition Period, each stockholder
must maintain an ownership percentage of the Corporation's outstanding common
stock that is no less than 75% and no more than 125% of the percentage
represented by such stockholder's most recent Global Proxy Calculation by
purchasing or selling shares, if necessary, in accordance with procedures to be
established by the Board of Directors within 12 months after receiving notice
from the Corporation that such stockholder is not in compliance with this
section. If a stockholder holds shares as the result of a transfer made pursuant
to clauses (iv) or (v) of the first sentence of Article III, Section 3 of these
Bylaws, then the percentage ownership test described in the preceding sentence
shall be calculated based upon the aggregate Global Proxy Calculation of the
stockholder and the Class A member(s) that transferred shares to the
stockholder. If a stockholder is unable to satisfy the requirement that it own
no more than 125% of the percentage represented by such stockholder's most
recent Global Proxy Calculation, the selling stockholder shall be obligated to
accept the highest price offered to such stockholder for such number of shares
of Common Stock as is necessary to enable such stockholder to satisfy such
requirement.

         Section 5. The Board of Directors shall establish procedures for the
purchase or sale of shares following the expiration of the Transition Period.

                                   ARTICLE IV

                               Board of Directors

         Section 1. The business of the Corporation will be managed by the Board
of Directors, which may exercise all of the powers of the Corporation and do all
lawful acts and things as are not


                                       7
<PAGE>
(i) by statute, the Certificate of Incorporation or these Bylaws directed or
required to be exercised or done by the stockholders or (ii) specifically
delegated as provided in these Bylaws.

         Section 2. a. The Board of Directors shall consist of such number of
persons, as shall be determined by the Board of Directors from time to time. The
Board of Directors initially shall consist of 18 persons.

         b. Each Director shall be an officer of a member institution of
MasterCard International Incorporated or an individual otherwise uniquely
qualified to provide guidance as to the Corporation's affairs. During the
Transition Period, one-third of the total number of Directors shall be officers
of stockholders of the Corporation or member institutions from the Corporation's
Europe region, as defined in the Integration Agreement ("Europe"), one-third of
the total number of Directors shall be officers of stockholders of the
Corporation or member institutions from the Corporation's U.S. region, the
President and Chief Executive Officer shall be a Director and the remaining
Directors shall be apportioned among officers of stockholders of the Corporation
or member institutions from the Corporation's other regions in accordance with
the percentage of the Corporation's outstanding stock owned by the stockholders
of each such region; provided, however, that in calculating the percentage of
outstanding stock owned by the stockholders of each region, transfers of shares
made pursuant to clauses (iv) or (v) of the first sentence of ARTICLE III,
Section 3 of these Bylaws shall be disregarded. After the Transition Period, the
President and Chief Executive Officer shall be a Director and the remaining
Directors shall be apportioned among officers of stockholders from the
Corporation's regions in accordance with the percentage of the Corporation's
outstanding stock owned by the stockholders of each such region, subject to
Article EIGHTH of the Certificate of Incorporation; provided, however, that in
calculating the percentage of outstanding stock owned by the stockholders of
each region, transfers of shares made pursuant to clauses (iv) or (v) of the
first sentence of ARTICLE III, Section 3 of these Bylaws shall be disregarded.
As used in these Bylaws, the phrase "entire Board of Directors" shall mean the
total number of directors, other than honorary members of the Board of Directors
(if any), that the Corporation would have if there were no vacancies.

         Section 3. There shall not be more than two representatives from any
one Class A member of MasterCard International Incorporated, including its
Affiliates and its affiliate members of MasterCard International Incorporated
that are sponsored by such Class A member, on the Board of Directors.

         Section 4. No individual may serve as a Director of the Corporation or
of any regional board if that individual also is a director (including a
regional board director), officer or other employee of or consultant to a
competitor of the Corporation, or if that individual is a director, officer or
other employee of or consultant to an institution that is represented on the
global board of directors or U.S. regional board of directors of a competitor.
For this purpose, a competitor of the Corporation is an entity that owns and/or
operates a payment card program competitive with the Corporation's comparable
card programs, as determined by the Corporation, and that is not itself a
stockholder of the Corporation.

         Section 5. During the Transition Period, the regional president of
Europe and, if approved by the Board of Directors, one officer of the
Corporation other than the President and Chief Executive Officer, shall serve as
honorary members of the Board of Directors and shall be entitled to receive
notice of all meetings of the Board of Directors and shall be permitted to
attend and participate in all meetings of the Board of Directors, but shall not
be entitled to vote.

         Section 6. The Corporation's Nominating Committee will consider and
nominate individuals to serve as Directors of the Corporation for approval by
the Corporation's stockholders at the annual meeting of stockholders based upon
proposals made by each regional board of the Corporation.


                                       8
<PAGE>
In the event of a disagreement between a regional board and the Corporation's
Nominating Committee with respect to a nominee(s) from that region, the chairman
of the regional board and the Corporation's Nominating Committee shall attempt
to resolve the dispute through direct consultation. If no resolution is reached
promptly, the Corporation's Nominating Committee shall present its recommended
slate of Directors to the Board of Directors and shall advise the Board of
Directors of any disagreement with respect to the nominees from any specific
region. The Board of Directors shall make the final determination with respect
to any dispute regarding a nominee for Director from a region.

         Section 7. The Board of Directors, by the affirmative vote of a
majority of the Directors then in office, and irrespective of any personal
interest of any of its members, may establish reasonable compensation of any or
all Directors for services to the Corporation as Directors.

         Section 8. The term of any Director who, after election to the Board of
Directors of the Corporation, subsequently fails to meet the requirements of
Sections 2, 3 or 4 of this ARTICLE IV or Article EIGHTH of the Corporation's
Certificate of Incorporation, shall terminate automatically at the time that the
Director so failed to qualify; provided, however, that the Board of Directors
may appoint that terminated Director to fill the vacancy caused by the
termination until the next annual meeting of stockholders unless such
termination resulted from the failure to satisfy the requirements of Section 4
of this ARTICLE IV or Article EIGHTH of the Corporation's Certificate of
Incorporation.

         Section 9. A vacancy in the Board of Directors, by reason of an
increase in the number of Directors or by reason of the death, resignation,
removal or termination of the term of a director, may be filled by the Board of
Directors in a manner consistent with the requirements of Sections 2, 3, and 4
of this ARTICLE IV and Article EIGHTH of the Corporation's Certificate of
Incorporation. Each Director shall hold office until a successor is elected and
qualified, or until the Director's earlier death, resignation, removal or
automatic termination of his term. A Director may resign at any time by written
notice to the Corporation addressed to the President and Chief Executive Officer
or the Secretary.

                                   ARTICLE V

                       Meetings of the Board of Directors

         Section 1. The first meeting of each newly-elected Board of Directors
shall be held immediately following the annual meeting of stockholders at the
place of such annual meeting of stockholders. If the first meeting is not held
at that time and place, then it shall be held at a time and place specified in a
notice given in the manner provided for notice of special meetings of the Board
of Directors as set forth in Section 3 of this ARTICLE V.

         Section 2. Regular meetings of the Board of Directors may be held upon
such notice, or without notice, at such times and at such places within or
outside of the State of Delaware as shall from time to time be determined by the
Board of Directors.

         Section 3. Special meetings of the Board of Directors, whether to be
held in person or by telephone or similar communications equipment, may be
called by the Chairman of the Board of Directors or the President and Chief
Executive Officer on at least five days' notice to each Director and shall be
called by the Chairman or the President and Chief Executive Officer upon the
written request of not less than 33 1/3% of the entire Board of Directors;
provided, however, that any special meeting of the Board of Directors called to
consider a matter that requires immediate action of the Board of Directors may
be called on at least 24 hours' notice if the matter does not require the
approval of greater than a simple majority of the Directors.


                                       9
<PAGE>
         Section 4. Whenever notice of a meeting of the Board of Directors is
required, the notice shall be given in the manner set forth in ARTICLE XV of
these Bylaws and shall state the purpose or purposes, place, date and hour of
the meeting.

         Section 5. Except as otherwise required by law or the Certificate of
Incorporation or other provisions of these Bylaws, a majority of the entire
Board of Directors shall constitute a quorum for the transaction of business
and, except as provided in Sections 1 and 2 of ARTICLE VI below, the vote of a
majority of the directors present at any meeting at which a quorum is present
shall be the act of the Board of Directors. If a quorum is not present at any
meeting of Directors, then a majority of the Directors present at the meeting
may adjourn the meeting from time to time, without notice of the adjourned
meeting other than announcement at the meeting. One or more Directors may
participate in a meeting of the Board of Directors by means of conference
telephone or similar communication device. To the extent permitted by law, a
Director participating in a meeting by conference telephone or similar
communications equipment by which all persons participating in the meeting can
hear each other will be deemed present in person at the meeting and all acts
taken by him or her during his or her participation shall be deemed taken at the
meeting. The place of any meeting held by means of conference telephone or
similar communications equipment pursuant to this Section 5 will be deemed to be
the place stated in the notice thereof so long as at least one Director or, as
the case may be, one committee person, is present at that place at the time of
that meeting.

         Section 6. Any action required or permitted to be taken at any meeting
of the Board of Directors, or of any committee thereof, may be taken without a
meeting if all members of the Board of Directors or the committee, as the case
may be, who are entitled to vote, consent thereto in writing, and the writing or
writings are filed with the minutes of proceedings of the Board of Directors or
of that committee.

                                   ARTICLE VI

                             Special Voting Matters

         Section 1. The following actions shall require approval of at least 75%
of the Directors present at a meeting at which a quorum is present:

                  a. any modification to Section 2b of ARTICLE IV of these
Bylaws; and

                  b. any modification to this Section 1.

         Section 2. The following actions shall require approval of at least 66
2/3% of the Directors present at a meeting at which a quorum is present:

                  a. Establishing or eliminating regional boards;

                  b. any modification to the RGO (Regional, Global and
Operations) planning, budgeting and reporting methodology;

                  c. any modification to the overall size of the Board of
Directors referred to in Section 2a of ARTICLE IV of these Bylaws;

                  d. any issuance of Class A Shares or Class B Shares in excess
of the number of shares to which a stockholder would be entitled under the
Global Proxy Calculation;


                                       10
<PAGE>
                  e. any decision to overrule a decision taken by a regional
board that was permitted to be taken in accordance with Section 6 of ARTICLE VII
of these Bylaws;

                  f. any decision to overrule a recommendation made by the Debit
Advisory Board that was permitted to be taken in accordance with Section 4 of
ARTICLE IX of these Bylaws; and

                  g. any modification to this Section 2.

                                  ARTICLE VII

                         Regional Boards and Management

         Section 1. The Board of Directors may establish or designate in
accordance with Section 2a of ARTICLE VI, one or more bodies to act as regional
boards of directors and exercise those powers and authorities delegated to them
by the Board of Directors of the Corporation or MasterCard International
Incorporated. The general purpose of each regional board is to manage the
Corporation's brand and product strategies on a regional level. The regional
boards shall not be boards of any incorporated entity. The initial powers and
authorities of the Corporation's regional boards are set forth below in Section
4.

         Section 2. Initially, there will be six regional boards: Asia/Pacific;
Canada; Europe; Latin America; Middle East/Africa; and the United States. Each
region shall have corporate staff responsible for all activities within the
region, including, without limitation, coordination and support of member
programs within the region. The members of each regional board shall be elected
by the stockholders of that region.

         Section 3. Each regional board shall establish an annual regional
budget for the following year, which budget shall provide sufficient funds to
(i) vigorously promote the Corporation's brands and fund the other regional
programs, initiatives and activities and (ii) fund the region's assignment of
centrally managed expenses. The method of funding the regional budgets will be
by assessments and other fees (including, without limitation, transaction and
operations fees) paid to the Corporation or its consolidated subsidiaries. If
budgeting authority has not been delegated to a regional board in a particular
region, the annual budget for that region shall be reviewed and approved by the
Board of Directors of the Corporation. The Corporation's entire annual budget
incorporating all regional budgets shall be submitted to the Board of Directors
for its approval no later than 30 days prior to the fiscal year to which it
applies. In its review of the Corporation's entire annual budget, the Board of
Directors shall, among other things, ensure that each final regional budget
provides for the appropriate level of expenses assigned to the region and the
level of expenditures necessary to appropriately support the Corporation's
brands and programs in that region and an appropriate method of funding such
expenses.

         Section 4. Each regional board shall have the authority to manage the
following activities, and any other activities that the Board of Directors may
delegate from time to time, within its region, provided that (i) such activities
shall affect and apply only to the affairs of the regional members licensed, and
applicants for a license, within such region and to transactions taking place
entirely within such region and then only with respect to MasterCard(R),
Cirrus(R) and Maestro(R) payment products (other than travelers cheques),
services, programs and activities and (ii) such activities have not otherwise
been delegated to the management of the Corporation:

                  a. MEMBERSHIP. Review all completed applications for
membership in MasterCard International Incorporated submitted by entities
headquartered in the specific region. The regional board also shall have the
power and authority to act upon any requests from regional members


                                       11
<PAGE>
of MasterCard International Incorporated regarding change of membership status
(other than termination) and class of membership. Only the Board of Directors of
the Corporation or MasterCard International Incorporated shall have the right to
terminate a member's membership in MasterCard International Incorporated and
license or license to participate in MasterCard(R), Cirrus(R) and Maestro(R);
however, the regional boards shall have the right to recommend such terminations
to the Board of Directors of the Corporation.

                  b. FINES AND DISCIPLINARY ACTIONS. Power and authority to (1)
establish and approve fines and disciplinary actions for intraregional
violations of the Corporation's or MasterCard International Incorporated's
bylaws, rules, policies or procedures by regional members of MasterCard
International Incorporated within the specific region and (2) recommend
terminations of such regional members of MasterCard International Incorporated
to the Board of Directors of the Corporation.

                  c. ANNUAL EXPENSE BUDGET. Power and authority and obligation
to approve an annual budget for the specific region within the time frames
needed to approve the entire annual budget of the Corporation. Such regional
budget shall comply with the practices, policies and procedures of the
Corporation and MasterCard International Incorporated.

                  d. ASSESSMENTS AND FEES. Power, authority and obligation to
fix, impose and collect assessments and fees from regional members of MasterCard
International Incorporated within the specific region in order to fund the
region's budget. This power shall extend to interregional transactions in which
a regional member of MasterCard International Incorporated is involved.

                  e. SURPLUS FUNDS. Power and authority to determine the
distribution of a portion of any revenues in excess of budgeted amounts in any
year, provided that such distribution is consistent with the Corporation's
reinvestment policy for excess funds then in effect or such other amount as
agreed with the President and Chief Executive Officer of the Corporation.

                  f. ADDITIONAL FUNDING. Power and authority to levy additional
assessments, fees or both upon regional members of MasterCard International
Incorporated within the region for the purpose of generating additional funds
above budgeted revenue in order to fund regional initiatives not provided for in
the region's annual budget. This power shall extend to interregional
transactions in which a regional member of MasterCard International Incorporated
is involved.

                  g. INTRAREGIONAL INTERCHANGE FEES. Power and authority to
approve intraregional interchange fees, subject to applicable regulatory
requirements.

                  h. INTRAREGIONAL OPERATING RULES. Power and authority to adopt
intraregional variances to the Corporation's operating rules, policies and
procedures that apply to MasterCard(R), Cirrus(R) and Maestro(R), to the extent
they apply only to members of MasterCard International Incorporated of a
specific region and their transactions effected wholly within a specific region,
which rules, policies and procedures cover the standards and procedures
governing how a specific transaction is initiated and processed, and how any
related disputes are resolved. Such rules may not have any effect, intended or
unintended, outside the region.

                  i. INTRAREGIONAL PRODUCT AND ENHANCEMENT DEVELOPMENT. Power
and authority to approve intraregional products and enhancement services
involving the creation and ongoing management of new regional payment vehicles
and enhancement services that add value to new and existing products.


                                       12
<PAGE>
                  j. AFFINITY AND CO-BRANDING RULES. With respect to
MasterCard(R), Cirrus(R) and Maestro(R) branded products only, the power and
authority to approve specific affinity and co-branding rules for the card
programs of members of MasterCard International Incorporated within the specific
region.

                  k. REGIONAL BOARD PROCESSES. Obligation to establish the
procedures and requirements for managing the regional board and its activities,
which shall be set forth in the regional board rules and shall include quorum
requirements, minimum vote requirements and the creation and seating of
committees.

         Section 5. The delegation of the powers and authorities upon the
regional boards as described in this ARTICLE VII, and the delegation of any
other powers or authorities that may be delegated upon one or more regional
boards by the Corporation's Board of Directors from time to time, is conditioned
upon compliance by the regional board with all applicable laws and all of the
requirements set forth in the Corporation's Certificate of Incorporation, rules
and regulations, these Bylaws and MasterCard International Incorporated's
certificate of incorporation, bylaws and membership and licensing rules and
regulations, and any other policies of the Corporation or MasterCard
International Incorporated, including the rules and regulations applicable to
Cirrus(R) and Maestro(R). Such delegated power and authority may not be
delegated by the regional boards. Management of the Corporation shall establish
the processes supporting the regional boards in their exercise of such delegated
power and authority.

         Section 6. Any decision of a regional board, to the extent such
decision is within the scope of power and authority delegated to such regional
board by the Board of Directors of the Corporation, shall be effective unless
and until the Board of Directors of the Corporation, in accordance with Section
2 of ARTICLE VI, determines otherwise, provided that the approval or adoption of
any action, rule or policy that could be expected, in the reasonable judgment of
the Board of Directors of the Corporation, to have an effect in more than one
region or that in the reasonable judgment of the Board of Directors of the
Corporation is inconsistent with a published policy, practice or strategy of the
Corporation, shall not become effective (or shall be declared ineffective if
already in effect) unless and until such action, rule or policy has been
ratified by the Board of Directors of the Corporation. Only the Corporation's
management shall be authorized to enter into a business arrangement with a
stockholder or a member of MasterCard International Incorporated that it can be
reasonably be determined will relate to activities that will be conducted in, or
have an effect in, more than one region, subject to any parameters as may be
determined by the Board of Directors. Nothing contained in this Section 6 shall
be construed to limit the authority of the Board of Directors of the Corporation
to revoke or amend the power and authority delegated upon the regional boards.

         Section 7. Each region shall have a regional president selected by the
President and Chief Executive Officer of the Corporation, subject to the
concurrence of the regional board. In the event of a disagreement between a
regional board and the President and Chief Executive Officer of the Corporation
with respect to a nominee for regional president, the chairman of the regional
board and the President and Chief Executive Officer of the Corporation shall
attempt to resolve the dispute through direct consultation. If no resolution is
reached promptly, the President and Chief Executive Officer of the Corporation
shall present his recommendation for regional president to the Board of
Directors and shall advise the Board of Directors of any disagreement with
respect to such selection. The Board of Directors shall only approve the
selection of the President and Chief Executive Officer upon the affirmative vote
of two-thirds of the entire Board of Directors with respect to any dispute
regarding the President and Chief Executive Officer's disputed selection for a
regional president. Each regional president shall report to the President and
Chief Executive Officer of the Corporation or such other member or members of
the Corporation's management as the President and Chief Executive Officer of


                                       13
<PAGE>
the Corporation may determine. Each regional president shall assist the
Corporation's Board of Directors and management and the regional board in
implementing the decisions and policies of the Corporation's Board of Directors
and management and the regional board (within the scope of power and authority
delegated by the Corporation's Board of Directors) that affect the region.
Notwithstanding anything herein to the contrary, during the Transition Period,
the regional president for Europe shall report only to the President and Chief
Executive Officer of the Corporation and shall be a member of the Corporation's
Global Executive Management Group. Any termination of a regional president by
the President and Chief Executive Officer of the Corporation shall require the
concurrence of the regional board, which shall not be unreasonably withheld.

                                  ARTICLE VIII

                                   Committees

         Section 1. The Board of Directors may designate from among its members
an Executive Committee, Audit Committee, Nominating Committee, Compensation
Committee and other committees to serve at the pleasure of the Board of
Directors.

                  a. EXECUTIVE COMMITTEE. The Executive Committee, if formed,
shall comprise the Chairman of the Board of Directors, the Vice Chairmen of the
Board of Directors, the President and Chief Executive Officer (for so long as he
or she is a Director of the Corporation) and such other number of Directors as
the Board of Directors shall establish from time to time so that the composition
of the Executive Committee generally reflects the regional composition of the
Corporation's stockholders. To the extent permitted by law, the Executive
Committee shall have all the authority of the Board of Directors, except that it
will not have the power or authority to approve or recommend an amendment to the
Corporation's Certificate of Incorporation or an agreement or plan of merger or
consolidation, to recommend the sale, lease or exchange of all or substantially
all of the Corporation's property and assets, to recommend the dissolution of
the Corporation or a revocation of dissolution, to amend these Bylaws or to take
any action that would require the affirmative vote of greater than a simple
majority of the members of the Board of Directors present at a meeting at which
a quorum is present.

                  b. AUDIT COMMITTEE. The Audit Committee, if formed, shall
comprise such number of Directors as the Board of Directors may appoint to it.
The Audit Committee will be responsible for reviewing the reports of the
Corporation's auditors and for performing such other duties as are assigned to
it by the Board of Directors.

                  c. NOMINATING COMMITTEE. The Nominating Committee shall
comprise such number of Directors as the Board of Directors may appoint to it.
In selecting Directors to serve on the Nominating Committee, the Board of
Directors shall seek to include individuals representing stockholders that
conduct business in multiple regions of the world, as well as individuals
representing stockholders that reflect the regional composition of the
Corporation's stockholders, and shall include representation from each region
representing greater than 20% of the most recent Global Proxy Calculation. The
Nominating Committee will be responsible for nominating persons to serve as
Directors and members of the Debit Advisory Board as described in ARTICLE IX. In
addition, the Nominating Committee may recommend individuals to serve on the
standing committees. In making nominations, the Nominating Committee will seek,
consistent with the qualifications required of Directors and committee members,
to give the stockholders in each geographic region reasonable representation,
taking into account, among other things, the number of shares of the
Corporation's stock owned by the stockholders in each region.


                                       14
<PAGE>
                  d. COMPENSATION COMMITTEE. The Compensation Committee, if
formed, shall comprise such number of Directors as the Board of Directors may
elect to it. The Compensation Committee may be responsible for fixing the
compensation of the elected officers of the Corporation and approving any
employee incentive programs. The compensation of all other employees will be
fixed by the Corporation's President and Chief Executive Officer (subject to the
oversight of the Board of Directors).

                  e. Any other committees, to the extent formed, shall have such
authority as the Board of Directors grants them. The Board of Directors shall
have power at any time to change the membership of any committees, to fill
vacancies in their membership and to discharge any committees.

         Section 2. Each committee shall keep regular minutes of its proceedings
and report to the Board of Directors as and when the Board of Directors shall
require. Unless the Board of Directors otherwise provides, notice requirements
for meetings of committees shall be the same as notice requirements for meetings
of the Board of Directors. Unless the Board of Directors otherwise provides, a
majority of the members of any committee may determine its actions and the
procedures to be followed at its meetings (which may include a procedure for
participating in meetings by conference telephone or similar communications
equipment by which all persons participating in the meeting can hear each
other).

         Section 3. Any action of a committee may be taken without a meeting if
written consent to the action signed by all the members of the committee is
filed with the minutes of the committee.

                                   ARTICLE IX

                              Debit Advisory Board

         Section 1. For an intended term of three years, the Corporation shall
have a Debit Advisory Board which will be responsible for providing advice to
the Board of Directors in the following areas:

                  a. the development and expansion of the Corporation's debit
programs globally;

                  b. global program and brand strategies, policies, rules and
technology standards for the Corporation's debit programs consistent with the
standards for the Corporation's other products set by the Board of Directors;
and

                  c. the performance and evaluation of the Corporation's Debit
Brand Management Group (or other group within the Corporation performing similar
functions).

For purposes of these Bylaws, the term "debit programs" shall mean the issuance
and acceptance of ATM and point-of-sale electronic payment devices that access
deposit accounts owned by an issuing member of MasterCard International
Incorporated under a trademark and/or service mark owned or managed, directly or
indirectly, by the Corporation or one of its subsidiaries.

         Section 2. Beginning on or after the two-year anniversary of the
creation of the Debit Advisory Board, the Board of Directors shall review the
performance of the Debit Advisory Board and consider, in its sole discretion,
whether, and on what terms, to continue the Debit Advisory Board, with the
understanding that it is the intent of the Corporation that the Debit Advisory
Board will continue for a third year.


                                       15
<PAGE>
         Section 3. During the first year of the existence of the Debit Advisory
Board, the Debit Advisory Board shall be comprised of the members of the Board
of Directors of Maestro International Incorporated in effect upon the date of
adoption of these Bylaws. The Nominating Committee will nominate individuals to
serve as members of the Debit Advisory Board beginning with the second year of
the Debit Advisory Board for approval by the Board of Directors. In selecting
nominees for service on the Debit Advisory Board, the Nominating Committee will
give due consideration to representatives from key stockholders of the
Corporation that support the Corporation's debit products, as measured by the
Global Proxy Calculation. Prior to presenting such nominations, the Nominating
Committee shall seek recommendations for candidates for the Debit Advisory Board
from the regional boards and shall duly consider all such recommendations. In
the event of a disagreement between a regional board and the Nominating
Committee with respect to a nominee(s) from that region, the chairman of the
regional board and the Nominating Committee shall attempt to resolve the dispute
through direct consultation. If no resolution is reached promptly, the
Nominating Committee shall present its recommended slate of Nominating Committee
members and shall advise the Board of Directors of any disagreement with respect
to the nominees from any specific region. The Board of Directors shall make the
final determination with respect to any dispute regarding a regional nominee.

         Section 4. Any recommendation of the Debit Advisory Board, to the
extent such recommendation is within the scope of power and authority delegated
to the Debit Advisory Board by the Board of Directors of the Corporation and is
not inconsistent with a published policy, practice or procedure, shall be
effective unless and until the Board of Directors of the Corporation, in
accordance with Section 2(f) of ARTICLE VI, overrules such recommendation.

                                   ARTICLE X

                                    Officers

         Section 1. Subject to the provisions of Section 1(a) below regarding
the election and term of the Chairman of the Board of Directors, the Board of
Directors shall, annually at its first meeting following the annual meeting of
stockholders, elect a Chairman of the Board of Directors from among its members,
a President and Chief Executive Officer and a Secretary; and the Board of
Directors may at that meeting, and thereafter, elect a Chairman Emeritus, up to
two Vice-Chairmen of the Board of Directors, a Chief Operating Officer, a
Treasurer and such other officers as it may from time to time deem advisable.
Except as prohibited by law, any two or more offices may be held by the same
person. No officer except the Chairman of the Board of Directors, the
Vice-Chairmen, if any, and the President and Chief Executive Officer need be a
Director of the Corporation.

                  a. THE CHAIRMAN OF THE BOARD OF DIRECTORS. The Chairman of the
Board of Directors shall be elected to an initial term of two years and shall be
eligible to be reelected annually thereafter. The Chairman of the Board of
Directors shall preside at all meetings of the members of the Board of Directors
and shall perform such other duties as are properly assigned to him by the Board
of Directors.

                  b. THE VICE-CHAIRMEN OF THE BOARD OF DIRECTORS. The Board of
Directors may elect up to two Vice-Chairmen of the Board of Directors. The
Vice-Chairmen shall have such powers assigned to them by the Chairman or by the
Board of Directors. In the absence of the Chairman, the Chairman shall designate
one of the Vice-Chairmen to preside at meetings of the Board of Directors.

                  c. THE CHAIRMAN EMERITUS. The Corporation may have a Chairman
Emeritus who shall be elected by the Board of Directors and shall be entitled to
receive notice of all meetings of the Board of Directors and shall be permitted
to attend and participate in all meetings of the Board of


                                       16
<PAGE>
Directors, but shall not be entitled to vote. The Chairman Emeritus must have
retired as an officer of a member of MasterCard International Incorporated while
serving as a member of the Board of Directors of the Corporation and must have
served as Chairman of the Board of Directors of the Corporation for at least two
years.

                  d. THE PRESIDENT AND CHIEF EXECUTIVE OFFICER. The Corporation
shall have a President who also shall be the Chief Executive Officer of the
Corporation. The President shall have general overall supervision of all
business of the Corporation and shall have such powers and duties as usually
pertain to such office or as may be assigned to him by the Board of Directors.
In the absence of the Chairman and the Vice-Chairmen, the President shall
perform the duties and exercise the powers of the Chairman of the Board of
Directors.

                  e. THE CHIEF OPERATING OFFICER. The Corporation may have a
Chief Operating Officer who shall be elected by the Board of Directors. The
Chief Operating Officer shall report directly to the President and Chief
Executive Officer and shall have such responsibilities as shall be assigned from
time to time by the President and Chief Executive Officer.

                  f. THE TREASURER. The Corporation may have a Treasurer who
shall be elected by the Board of Directors. The Treasurer shall have the care
and custody of all moneys and securities of the Corporation. He or she shall
cause to be entered in records to be kept for that purpose full and accurate
accounts of all moneys received by him or her and paid by him or her on account
of the Corporation. He or she shall make and sign such reports, statements and
documents as may be required by him of the Board of Directors or by the laws of
the United States, the State of Delaware or any other state or country, and
shall perform such other duties as usually pertain to such office or as may be
assigned to him by the Board of Directors. The Treasurer shall be bonded in the
manner and amount prescribed by the Board of Directors. The reports and records
of the Treasurer shall be audited as of the end of each fiscal year and at such
other times as the Board of Directors may direct by independent certified public
accountants selected by the Board of Directors or by a committee of members
designated by the Chairman of the Board of Directors with the approval of the
Board of Directors.

                  g. THE SECRETARY. The Corporation shall have a Secretary who
shall be elected by the Board of Directors. The Secretary shall issue notices of
meetings of stockholders and of the Board of Directors when such notices are
required by law or these Bylaws. The Secretary shall attend all meetings of the
stockholders and of the Board of Directors and keep the minutes thereof. He or
she shall affix the Corporation's seal to such instruments as require the seal
and shall perform such other duties as usually pertain to such office or as may
be assigned to her/him by the Board of Directors or as may otherwise be provided
for in these Bylaws.

         Section 2. Subject to the provisions of Section 1(a) above regarding
the election and term of the Chairman of the Board of Directors, each officer
shall be elected by the Board of Directors and shall hold office until the
earliest of such individual's death, resignation, removal or the first meeting
of the Board of Directors following the next annual meeting of stockholders. Any
officer may be removed at any time, either with or without cause, by the Board
of Directors. If any office becomes vacant for any reason, the vacancy may be
filled by the Board of Directors.

         Section 3. Any officer may resign at any time by giving written notice
to the Board of Directors or to the President and Chief Executive Officer. Such
resignation shall take effect at the time specified in the notice or, if no time
is specified, at the time of receipt of the notice, and the acceptance of such
resignation shall not be necessary to make it effective.


                                       17
<PAGE>
         Section 4. The Corporation may secure the fidelity of any or all of its
officers or agents by bond or otherwise. In addition, the Board of Directors may
require any officer, agent or employee to give security for the faithful
performance of his duties.

         Section 5. In the event of an absence or illness of any officer, or for
any other reason that the Board of Directors or the President and Chief
Executive Officer may deem sufficient, the Board of Directors or the President
and Chief Executive Officer may temporarily assign the powers and duties of that
officer to any other officer or to any Director.

         Section 6. The compensation of the elected officers shall be fixed by
the Board of Directors or a committee thereof. The compensation of other
employees of the Corporation shall be fixed by the President and Chief Executive
Officer (subject to the oversight of the Board of Directors). All employee
incentive programs shall be approved by the Board of Directors or a committee
thereof.

                                   ARTICLE XI

                             Certificates for Shares

         Section 1. In the discretion of the Board of Directors, the shares of
stock of the Corporation may be represented by certificates, in such form as the
Board of Directors may from time to time prescribe, signed by the Chairman of
the Board of Directors, or the President and Chief Executive Officer or a Vice
President and by the Treasurer or an Assistant Treasurer, or the Secretary or an
Assistant Secretary and bearing any legends as may be prescribed by the
Certificate of Incorporation or otherwise.

         Section 2. In the event that the shares of stock of the Corporation are
not represented by certificates, the name, address and number and class of
shares owned by each stockholder shall be set forth in the books and records of
the Corporation, as such may be amended from time to time by the Corporation to
reflect any change in the name, address and/or number or class of shares owned
by each stockholder.

         Section 3. Any or all signatures upon a certificate may be a facsimile.
Even if an officer, transfer agent or registrar who has signed or whose
facsimile signature has been placed upon a certificate shall cease to be that
officer, transfer agent or registrar before the certificate is issued, that
certificate may be issued by the Corporation with the same effect as if he or
she or it were that officer, transfer agent or registrar at the date of issue.

         Section 4. The Board of Directors may direct that a new certificate be
issued in place of any certificate issued by the Corporation that is alleged to
have been lost, stolen or destroyed. When doing so, the Board of Directors may
prescribe such terms and conditions precedent to the issuance of the new
certificate as it deems expedient, and may require a bond sufficient to
indemnify the Corporation against any claim that may be made against it with
regard to the allegedly lost, stolen or destroyed certificate or the issuance of
the new certificate.

         Section 5. The Corporation or a transfer agent of the Corporation, upon
surrender to it of a certificate representing shares, duly endorsed and
accompanied by proper evidence of lawful succession, assignment or authority of
transfer, shall issue a new certificate to the person entitled thereto, and
shall cancel the old certificate and record the transaction upon the books of
the Corporation.

         Section 6. The Corporation shall for all purposes be entitled to treat
a person registered on its books, as the owner of shares, with the exclusive
right, among other things, to receive dividends and to vote with regard to those
shares, and the Corporation shall be entitled to hold a person registered on


                                       18
<PAGE>
its books as the owner of shares and shall not be bound to recognize any
equitable or other claim to, or interest in, shares of its stock on the part of
any other person, whether or not the Corporation shall have express or other
notice of the claim or interest of the other person, except as otherwise
provided by the laws of Delaware.

                                  ARTICLE XII

                                 Indemnification

         Section 1. The Corporation shall indemnify any person who was or is
made a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Corporation) by
reason of the fact that the person is or was a director, officer, employee or
agent of the Corporation, or is or was serving at the request of the Corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise to the fullest extent permitted by
Delaware law.

         Section 2. The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that the person is or was a
director, officer, employee or agent of the Corporation, or is or was serving at
the request of the Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise to
the fullest extent permitted by Delaware law.

         Section 3. To the extent that a present or former director, officer,
employee or agent of the Corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in Sections 1
and 2 of this ARTICLE, or in defense of any claim, issue or matter therein, such
person shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by the person in connection therewith.

         Section 4. Any indemnification under Sections 1 and 2 of this ARTICLE
(unless ordered by a court) shall be made by the Corporation only as authorized
in the specific case upon a determination that indemnification of the present or
former director, officer, employee or agent is proper in the circumstances
because he or she has met the applicable standard of conduct set forth in
Sections 1 and 2. Such determination will be made, with respect to a person who
is a director or officer at the time of such determination, (1) by a majority
vote of the Board of Directors who were not parties to such action, suit or
proceeding even though less than a quorum, or (2) by a committee or such
Directors designated by majority vote of such Directors, even though less than a
quorum, or (3) if there are no such Directors, or if such Directors so direct,
by independent legal counsel (compensated by the Corporation) in a written
opinion or (4) by the stockholders.

         Section 5. Expenses (including attorneys' fees) incurred by any
director, officer, employee or agent in defending a civil, criminal,
administrative or investigative action, suit or proceeding, or threat thereof,
may be paid by the Corporation in advance of the final disposition of such
action, suit or proceeding in the specific case upon receipt of an undertaking
by or on behalf of the director, officer, employee or agent to repay such amount
if it shall ultimately be determined that such person is not entitled to be
indemnified by the Corporation as authorized in this ARTICLE. Such expenses
(including attorney's fees) incurred by a former director, officer, employee or
agent may be paid upon such terms and conditions, if any, as the Corporation
deems appropriate.


                                       19
<PAGE>
         Section 6. The indemnification and advancement of expenses provided by,
or granted pursuant to, the other Sections of this ARTICLE shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in such
person's official capacity and as to action in another capacity while holding
such office.

         Section 7. The Corporation may purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against such
person and incurred by such person in any such capacity, or arising out of such
person's status as such, whether or not the Corporation would have the power to
indemnify such person against such liability under the provisions of this
ARTICLE.

         Section 8. References in this ARTICLE to "the Corporation" will
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger that, if its separate existence had continued, would have had power and
authority to indemnify its directors, officers, employees or agents so that any
person who is or was a director, officer, employee or agent of such constituent
corporation, or is or was serving at the request of such constituent corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, will stand in the same position under
the provisions of this ARTICLE with respect to the resulting or surviving
corporation as such person would have with respect to such constituent
corporation if its separate existence had continued.

         Section 9. For purposes of this ARTICLE, references to "other
enterprises" will include employee benefit plans; references to "fines" will
include any excise taxes assessed on a person with respect to an employee
benefit plan; references to "serving at the request of the Corporation" shall
include any service as a director, officer, employee or agent of a subsidiary of
the Corporation and any service as a director, officer, employee or agent of the
Corporation which imposes duties on, or involves services by, such director,
officer, employee or agent with respect to an employee benefit plan, its
participants or beneficiaries; and a person who acted in good faith and in a
manner such person reasonably believed to be in the interest of the participants
and beneficiaries of an employee benefit plan will be deemed to have acted in a
manner "not opposed to the best interests of the Corporation" as referred to in
this ARTICLE.

         Section 10. The indemnification and advancement of expenses provided
by, or granted pursuant to, this ARTICLE shall, unless otherwise provided, when
authorized or ratified continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such person.

         Section 11. Except as specifically permitted by applicable law, no
person who is or was a director, officer, employee, agent or member of any
committee of the Corporation shall be indemnified in any way if such person has
brought the action or proceeding against the Corporation, its directors,
officers, employees, agents or any committee of the Corporation.

         Section 12. The provisions of this ARTICLE will be deemed retroactive
and will include all acts of the directors, officers, employees or agents of the
Corporation since the date of incorporation.


                                       20
<PAGE>
                                  ARTICLE XIII

                               General Provisions

         Section 1. The corporate seal shall be circular in form with the words
"MasterCard Incorporated" around the outer margin and the words and figures
"CORPORATE SEAL 2001 DELAWARE" in the center and such other appropriate legend
as the Board of Directors may from time to time determine. Unless prohibited by
the Board of Directors, a facsimile of the corporate seal may be affixed or
reproduced in lieu of the corporate seal itself.

         Section 2. The fiscal year of the Corporation shall be the calendar
year.

         Section 3. The symbol of the Corporation will be the word "MasterCard"
superimposed across a red circle overlapping a yellow circle in the form adopted
by the Board of Directors as the corporate symbol of the Corporation.

         Section 4. As used in these Bylaws, the term "card" means a device,
complying with the specifications set forth in the rules and regulations of
MasterCard International Incorporated, which may be used to pay for goods and/or
services and to obtain cash through access of the cardholder's credit, charge or
depositary account with the issuer of the cards.

         Section 5. As used in these Bylaws, the phrase "published policy" is
one that has been disseminated by bulletin, letter or other form of written or
electronic communication to, at least, the stockholders and/or the Class A
members of MasterCard International Incorporated that, along with their
affiliate members, if any, are affected by such policy.

         Section 6. The books of the Corporation, except such as are required by
law to be kept within the State of Delaware, may be kept at such place or places
within or outside of the State of Delaware as the Board of Directors may from
time to time determine.

                                  ARTICLE XIV

                                   Amendments

         Section 1. The Board of Directors, by the affirmative vote of a
majority of the entire Board of Directors at any meeting of the Board of
Directors at which a quorum is present, or by action without a meeting if all of
the Directors consent in writing to that action, may adopt, amend or repeal any
provision of these Bylaws, except that (i) any amendment or repeal of Section 1
of ARTICLE VI shall require the affirmative vote of at least 75% of the
Directors present at a meeting at which a quorum is present, (ii) any amendment
or repeal of Section 2 of ARTICLE VI shall require the affirmative vote of at
least 66 2/3% of the Directors present at a meeting at which a quorum is present
and (iii) any amendment or repeal of Section 2 of ARTICLE III shall be subject
to the terms and conditions of Article EIGHTH of the Corporation's Certificate
of Incorporation.

         Section 2. The stockholders, by the affirmative vote of a majority of
the votes cast at any meeting of the stockholders at which a quorum is present
or by action without a meeting in accordance with these Bylaws, may adopt, amend
or repeal any provision of these Bylaws; provided, however, that any amendment
or repeal of Section 2 of ARTICLE III shall be subject to the terms and
conditions of Article EIGHTH of the Corporation's Certificate of Incorporation.


                                       21
<PAGE>
                                   ARTICLE XV

                                     Notices

         Section 1. To the extent permitted by applicable law, any notice to a
stockholder may be given personally, by mail, facsimile transmission, telex,
telegraph, cable or similar instrumentality or by electronic transmission. A
notice will be deemed given when actually given in person; when transmitted by a
legible transmission, if given by facsimile transmission; when transmitted,
answerback received, if given by telex; on the day when delivered to a cable or
similar communications company; three business days after delivery to a courier
service; or on the fifth business day after the day when deposited with the
United States mail, postage prepaid, directed to the stockholder at such
stockholder's address, facsimile number, electronic mail address or telex number
as it appears on the records of stockholders or at such other address, facsimile
number, electronic mail address or telex number as the stockholder may have
designated to the Secretary in writing as the address or number to which notices
should be sent. Notice given by a posting on electronic network together with
separate notice to the stockholder of such specific posting, shall be deemed
given upon the later of (A) such posting and (B) the giving of such separate
notice. Notice given by any other form of electronic transmission shall be
deemed given when directed to the stockholder.

         Section 2. Any notice to a Director may be given personally, by
telephone, by mail, facsimile transmission, telex, telegraph, cable or similar
instrumentality or electronic transmission to such Director's residence or usual
place of business. A notice will be deemed given when actually given in person
or by telephone; when transmitted by a legible transmission, if given by
facsimile transmission; when transmitted, answerback received, if given by
telex; on the day when delivered to a cable or similar communications company;
three business days after delivery to a courier service; or on the fifth
business day after the day when deposited with the United States mail, postage
prepaid, directed to the director at his business address, facsimile number,
electronic mail address or telex number or at such other address, facsimile
number, electronic mail address or telex number as the director may have
designated to the Secretary in writing as the address or number to which notices
should be sent. Notice given by any form of electronic transmission shall be
deemed given when directed to the Director.

         Section 3. Any person may waive notice of any meeting by signing a
written waiver or by electronic transmission, whether before or after the
meeting. In addition, attendance at a meeting will be deemed a waiver of notice
unless the person attends for the purpose, expressed to the meeting at its
commencement, of objecting to the transaction of any business because the
meeting is not lawfully called or convened.


                                       22


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>5
<FILENAME>y62026exv99w1.txt
<DESCRIPTION>PORTIONS OF PROXY STATEMENT
<TEXT>
<PAGE>

                                 THE CONVERSION

OVERVIEW OF THE CONVERSION

     The conversion refers to the process by which MasterCard International will
merge with a subsidiary of MasterCard Incorporated, a newly formed stock holding
company. After the conversion, MasterCard International will continue as a
non-stock corporation and the principal operating subsidiary of MasterCard
Incorporated, which will own the sole class B membership interest of MasterCard
International. In the conversion, each principal member of MasterCard
International will receive shares of class A redeemable common stock and class B
convertible common stock of MasterCard Incorporated representing that member's
equity interest in MasterCard Incorporated, and a class A membership interest in
MasterCard International representing that member's continued rights as a
licensee to use MasterCard's brands, programs and services. MasterCard
International's rules and standards will not be affected by the conversion and
integration.


     We expect that the conversion will be completed as soon as practicable
after the conditions to conversion are satisfied, including approval of the
conversion by the members and the expiration or termination of any waiting
period under the HSR Act. We anticipate that these conditions will be satisfied
and that the conversion will be completed in the first half of 2002.


EFFECTS OF THE CONVERSION

     As a stockholder of MasterCard Incorporated, you will have the right to
vote on all matters submitted to the stockholders for a vote, including the
election of the board of directors, and extraordinary transactions, such as a
merger, consolidation, or sale of all or substantially all of the assets or
dissolution of MasterCard Incorporated. In any vote for the election of
directors, no stockholder, together with its affiliates, will be entitled to
vote more than 7% of the outstanding shares that are entitled to vote in that
election.

     The board of directors of MasterCard International is required to be the
same as the board of directors of MasterCard Incorporated. You will have the
right to vote on proposed changes to Article I (Membership) of the bylaws of
MasterCard International, but you will no longer be entitled to vote with
respect to any other amendments of the charter or bylaws of MasterCard
International. The rules for the qualification of members of MasterCard
International will be the same as the current rules for the qualification of
members of MasterCard International.

     The directors and executive officers of MasterCard Incorporated after the
conversion and integration will be the same as the directors and executive
officers of MasterCard International before the conversion except for the
addition of two voting directors who will be affiliated with European members
and the addition of Dr. Peter Hoch, currently Chief Executive Officer of
Europay, who will be President of MasterCard's Europe region (an officer of
MasterCard Incorporated) and a non-voting director. In particular, if the
conversion is approved, the current directors of MasterCard International will
serve as the directors of MasterCard Incorporated and MasterCard International
until the annual meeting of MasterCard Incorporated shareholders in 2003. In
addition, the boards of directors of each company, acting pursuant to authority
granted to them in their respective certificates of incorporation and/or bylaws,
will appoint two additional voting directors affiliated with European members
and Dr. Peter Hoch as a non-voting director, in each case to serve until the
annual meeting of MasterCard Incorporated shareholders in 2003. The board of
directors of MasterCard Incorporated will be subject to reelection in 2003. If
the conversion does not occur, the current directors of MasterCard International
will continue in that capacity until an annual meeting of MasterCard
International principal members is held in 2003.

     The bylaws of MasterCard Incorporated provide that during the three year
transition period following the closing of the conversion and integration:

     - one-third of the members of MasterCard Incorporated's board of directors
       will be representatives of MasterCard Incorporated's European
       stockholders;

     - one-third of the members of MasterCard Incorporated's board of directors
       will be representatives of MasterCard Incorporated's U.S. stockholders;

     - the President and Chief Executive Officer of MasterCard Incorporated will
       be a director; and

                                        35
<PAGE>

     - the remaining directors will be apportioned among the other regions in
       accordance with the percentage of common stock owned by the stockholders
       of those regions.

     After the three-year transition period, the President and Chief Executive
Officer will continue to be a director and all other directors will be
apportioned among the regions according to each region's respective share of the
aggregate vote. The integration agreement provides that the allocation of
one-third of the board seats to Europe during the transition period may not be
altered.

     The board of directors of MasterCard Incorporated will initially consist of
18 voting members -- six from the U.S., six from Europe, three from
Asia/Pacific, one from Canada, one from Latin America and the Caribbean and the
President and Chief Executive Officer of MasterCard Incorporated. The directors
will be elected by the class A and class B stockholders, voting together as a
single class (so long as the class B convertible shares are entitled to vote),
with each share entitled to one vote, subject to the following limitations:

     - no more than two representatives from any member (including its
       affiliates and affiliate members) may sit on the board of directors;

     - no single stockholder, together with its affiliates, may exercise more
       than 7% of the voting power in any election of directors; and

     - no more than one-third of the board of directors may be representatives
       from a single region.

     In addition to the MasterCard Incorporated board of directors, there will
be a regional board for each of MasterCard's six operating regions:
Asia/Pacific, Canada, Europe, Latin America and the Caribbean, Middle
East/Africa and the United States. Each of the regional boards will be elected
by the members from that region. Decisions to establish or eliminate a regional
board or overrule one of its decisions must be approved by a two-thirds majority
vote of the board of directors. In addition, all of the regions will have a
regional president, who will be selected by the President and Chief Executive
Officer of MasterCard Incorporated in concurrence with the regional board (or
otherwise with a two-thirds majority of the global board of directors).
MasterCard Incorporated will also establish a Debit Advisory Board to provide
guidance with respect to the ongoing development of MasterCard's debit programs.
The powers and responsibilities of the regional boards following the conversion
and integration are expected to be substantially similar to the powers and
responsibilities of those boards before the conversion and integration.

     For a description of the supermajority requirements necessary to revise
these governance arrangements, see "Comparison of Rights of MasterCard
International Members Before and After the Conversion and Integration -- Vote on
Extraordinary Transactions/Supermajority Voting Provisions."

CONSIDERATIONS RELATING TO THE CONVERSION

     In approving the conversion and recommending that you approve the
conversion, our board of directors considered a number of advantages of the new
structure. By creating a new holding company, MasterCard Incorporated, which
will own MasterCard International, we expect to realize many of the advantages
of a stock corporation at the holding company level, while maintaining the
flexibility of a membership association in governing the operations of our
global payments programs at the subsidiary level. As is typical of a holding
company structure, the holding company, MasterCard Incorporated, will control
the voting power of its operating subsidiary, MasterCard International, with
regard to all items that require a vote of MasterCard International's members,
except for amendments to Article I (Membership) of the bylaws.

     We believe that the conversion will enhance the value of our business and
our future opportunities by providing us some of the benefits of being a public
company. Specifically, we believe that the conversion will:

     - permit member-stockholders to realize the value of their investment in
       MasterCard as an asset and, subject to certain restrictions, trade
       MasterCard Incorporated shares among themselves;

     - align more closely the interests of MasterCard and our
       member-stockholders. As member-stockholders increase their MasterCard
       business, their relative shareholdings in MasterCard Incorporated may
       increase;

                                        36
<PAGE>

     - provide a more flexible structure to respond to opportunities in the
       marketplace, for example, by permitting us to complete the integration
       with Europay more efficiently since Europay already has capital stock
       outstanding or by permitting us to use our class C common stock as
       acquisition currency in future acquisitions;

     - result in greater financial transparency for our member-stockholders,
       since after the conversion MasterCard Incorporated will report financial
       and business information on a quarterly basis in accordance with
       Securities and Exchange Commission rules and regulations; and

     - make it easier, if desired, for MasterCard Incorporated to raise
       financing in the public securities markets to fund technological
       innovations and other projects since MasterCard Incorporated will be a
       public reporting company.

     In approving the conversion and recommending that you approve the
conversion, our board of directors also considered potential disadvantages of
the new structure. Specifically, it is possible that:

     - a market for MasterCard Incorporated common stock may not develop
       sufficiently to provide member-stockholders with enough liquidity in
       trading their shares;

     - stockholders may be required to purchase or sell shares of MasterCard
       Incorporated in order to satisfy certain requirements, which may be
       disadvantageous to them;

     - the conversion will facilitate future strategic transactions that could
       reduce the influence of current MasterCard International members;

     - MasterCard Incorporated and certain member-stockholders will be subject
       to additional regulatory burdens, including Securities and Exchange
       Commission regulations, as a result of the conversion; and

     - the conversion could subject some members to tax liabilities.

     No director or officer or any of their affiliates has a substantial
interest, direct or indirect, in the conversion.

BOARD OF DIRECTORS' AND PRINCIPAL MEMBERS' APPROVAL


     On February 8, 2001, the board of directors of MasterCard International
approved resolutions recommending the conversion to MasterCard International's
members. Approval at the special meeting of at least a majority of voting power
of MasterCard International's principal members is required to complete the plan
of conversion; the quorum for the special meeting is the presence in person or
by proxy of members representing a majority of the votes eligible to be cast.
Notwithstanding member approval, however, the plan of conversion will not be
completed if the integration will not also be completed.


     THE BOARD OF DIRECTORS OF MASTERCARD INTERNATIONAL RECOMMENDS THAT MEMBERS
VOTE FOR APPROVAL OF THE PLAN OF CONVERSION.

THE MERGER AGREEMENT EFFECTING THE CONVERSION

     We summarize below the material terms and other provisions of the merger
agreement. The description is not complete, and we refer you to the merger
agreement, which is contained in Annex A of this proxy statement-prospectus and
which we have filed as an exhibit to the registration statement of which this
proxy statement-prospectus is a part.

CONVERSION OF MEMBERSHIP INTERESTS

     The conversion will be effected pursuant to the Agreement and Plan of
Merger entered into among MasterCard Incorporated, MasterCard International and
MasterCard Merger Sub, Inc., which we refer to as the merger agreement. The
merger agreement provides for the merger of MasterCard International and
MasterCard Merger Sub, Inc. under Delaware law, with MasterCard International
being the surviving entity. Under the merger agreement, each issued and
outstanding principal membership interest in MasterCard International will be
automatically converted by virtue of the merger into a class A membership
interest of MasterCard International and a specified number of shares of class A
redeemable common stock and class B convertible common stock of MasterCard
Incorporated. The number of shares of class A redeemable and

                                        37
<PAGE>

class B convertible common stock of MasterCard Incorporated that a principal
member receives in the merger will be proportional to the percentage of the
total voting power of MasterCard International that such member held in
accordance with the historic global proxy formula in effect for the period ended
September 30, 2000. Upon completion of the conversion and integration and as an
integral component thereof, the shares of class A redeemable common stock and
class B convertible common stock of MasterCard Incorporated will initially be
reallocated within each of the European and non-European member-stockholder
groups in accordance with the new global proxy formula based on the 12 month
period ended December 31, 2000. Accordingly, the new global proxy formula,
applied on a regional basis, will determine the number of shares that members
actually receive in the conversion and integration.

     Class A redeemable and class B convertible common stock are fully paid,
non-assessable voting equity interests in MasterCard Incorporated. The class A
membership interest in MasterCard International represents the member's
continued rights as a licensee to use MasterCard's brands, programs and services
and participate in the MasterCard system. For a description of the allocation of
shares resulting from the conversion and integration, see "Share Allocation and
the Global Proxy."

     Under the merger agreement, MasterCard Incorporated will receive the sole
outstanding class B membership interest in MasterCard International, which will
entitle MasterCard Incorporated to substantially all of the voting power, and
all economic rights, in MasterCard International. MasterCard Incorporated's
stockholders will participate indirectly in the voting power of, and economic
rights associated with, the class B membership interest through their ownership
of the class A redeemable and class B convertible common stock of MasterCard
Incorporated.


     The merger will not close, and your existing membership interest will not
be modified as described above, unless a majority of the voting power of
MasterCard International's principal members at a meeting at which a quorum is
present approve the conversion and the merger agreement. The board of directors
of each of MasterCard Incorporated, MasterCard International and MasterCard
Merger Sub, Inc. may terminate the merger agreement at any time prior to the
conversion whether before or after the approval of the members of MasterCard
International.


APPLICATION OF THE SECURITIES LAWS TO SHARES RECEIVED

     As a result of the conversion, stockholders of MasterCard Incorporated will
be subject to various provisions of the U.S. federal securities laws. Pursuant
to Rule 10b-5 under the Securities Exchange Act of 1934, as amended, which we
refer to as the Exchange Act, all stockholders will be prohibited from trading
MasterCard Incorporated shares while in possession of any material, non-public
information about MasterCard Incorporated. In addition, certain significant
stockholders of MasterCard Incorporated may be required to file public reports
with respect to their stockholdings. Other reporting obligations may also apply.
Responsibility for compliance with these laws will reside with the applicable
stockholder, not MasterCard Incorporated.

APPLICATION OF U.S. BANKING REGULATIONS TO SHARES RECEIVED

     Banking regulations in the United States govern, among other things, the
types of equity investments that regulated institutions are permitted to make.
For a description of the potential application of federal and state banking
regulations to the shares received in the conversion, see "Risk Factors -- Risks
Related to the Conversion -- U.S. banking regulations may impact our principal
members' ownership of the common stock of MasterCard Incorporated."

ACCOUNTING TREATMENT OF THE CONVERSION

     We anticipate that upon our conversion to a stock corporation, our retained
earnings will be reallocated to capital stock and additional paid-in capital on
issuance of common stock to members in exchange for their member interests. This
treatment is consistent with accounting for demutualizations in accordance with
accounting principles generally accepted in the United States.

     With respect to the manner in which they account for their equity interest
in MasterCard, members should consult their financial advisors regarding the
potential accounting implications of the conversion.

                                        38
<PAGE>

                                THE INTEGRATION

OVERVIEW OF THE INTEGRATION

     The integration refers to the acquisition of Europay by MasterCard
Incorporated and the integration of the businesses of Europay and MasterCard
International. In the integration, Europay's shareholders other than MasterCard
International and MEPUK will exchange their Europay shares (and shareholders of
MEPUK will exchange their MEPUK shares) for shares of class A redeemable common
stock and class B convertible common stock of MasterCard Incorporated. For a
description of the allocation of shares resulting from the conversion and
integration, see "Share Allocation and the Global Proxy."

BACKGROUND OF THE INTEGRATION


     History.  MasterCard International has a long-standing relationship with
Europay, originating with Eurocard International's alliance with Interbank Card
Association, MasterCard's predecessor, in 1968. In 1996, MasterCard
International and Europay entered into an alliance agreement under which
MasterCard International delegated to Europay the authority to manage the
MasterCard brand in Europe and to process the licensing of MasterCard's brands
to European financial institutions. MasterCard International and Europay
established Maestro International, a joint venture, in 1991 to oversee the
global development of the Maestro debit service, and entered into an agreement
regarding the Maestro brand in 1997 to further strengthen their cooperation in
this area. Each of MasterCard International and Europay own a 50% interest in
Maestro International Incorporated, a Delaware corporation which owns the
Maestro brand. MasterCard International currently owns approximately 12.25% of
the capital stock of Europay and 15.0% of the capital stock of European Payment
Systems Services (EPSS), Europay's transaction processing subsidiary. Together,
these interests represent an approximate 15% interest in Europay on a
consolidated basis. In addition, European members currently own approximately 7%
of the total voting power, and related economic rights, of MasterCard
International.


     Early Negotiations.  As the MasterCard-Europay relationship developed, the
managements of the organizations came to believe that they could significantly
enhance the value of their alliance if they more fully integrated their
organizations and focused their combined efforts on promoting a core set of
global brands and services. In November 1999, a subcommittee of the MasterCard
International board of directors authorized management to retain the services of
Mercer Management Consulting to advise the board on revisions to MasterCard's
corporate governance structure. Among other things, the board charged Mercer
with the task of evaluating the existing MasterCard/Europay alliance. During a
period of five months, representatives of Mercer met with members of the
management teams of both parties and members of their respective boards of
directors. The purpose of these meetings was to gather information about the
working relationship of the parties and to assess whether improvements could and
should be made.

     At a meeting of MasterCard International's board held on March 23, 2000,
representatives of Mercer reported that, while the relationship between
MasterCard International and Europay under the alliance agreement was generally
positive, the parties would be better served by combining their organizations,
aligning their interests more directly, focusing their considerable combined
resources on promoting MasterCard's core brands and eliminating duplicative
functions.

     On March 23, 2000, the MasterCard International board authorized the
formation of a committee consisting of Donald L. Boudreau, MasterCard
International's then Chairman, and Robert W. Pearce, a director, to enter into
preliminary discussions about the possibility of integrating the organizations.
On April 13, 2000, the board of directors of Europay designated a counterpart
committee consisting of Dr. Kurt Richolt, Europay's then Chairman, Dr. Wolfgang
Klein, then a director of Europay, and Baldomero Falcones Jaquotot, a director
of Europay and MasterCard International.

     The negotiating committees first met on April 14, 2000. A second meeting
was held on April 26, 2000. At these initial meetings, the committee members
discussed the framework for a possible integration, including structural
alternatives. No formal proposals regarding valuation or the type and amount of
consideration to be issued to the stockholders of Europay were discussed at
these initial meetings, although it was generally understood that the
consideration would include some form of equity, rather than cash. Further
meetings were held in May 2000 and in June 2000 (by teleconference). These
meetings focused primarily on issues of

                                        39
<PAGE>

consideration. At the June 2000 meeting, the negotiating committees discussed
the first draft of a term sheet that had been prepared by Mercer. In particular,
the parties discussed the relative contribution that Europay's members would
make to the revenues and transaction volume of a combined organization.
Europay's view was that, based on a contribution analysis, the European members
should be entitled to 33 1/3% of the equity in the combined company. MasterCard
wanted to study further the level of contribution that Europay was likely to
make and, in particular, the likelihood that transaction volume associated with
Europay's regional ec Pictogram brand would be converted to Maestro transaction
volume in the future.

     Later Negotiations.  In July 2000, the boards of directors of MasterCard
International and Europay reviewed the progress that had been achieved by the
negotiating committees. At these meetings, representatives of Mercer presented a
report summarizing the work of the negotiating committees to date. At its July
27, 2000 meeting, the MasterCard International board authorized the MasterCard
negotiating committee to continue its work.

     Following these board meetings, the Europay negotiating team advised the
MasterCard International team that the Europay shareholders strongly favored a
stock conversion and viewed it as a critical part of the overall transaction.
MasterCard was amenable to the concept of a stock conversion, subject to review
of the potential tax, securities laws and other consequences. Each of MasterCard
International and Europay retained financial advisers to assist the negotiating
teams in analyzing the companies and to advise them with respect to valuation
matters. MasterCard retained Donaldson, Lufkin & Jenrette (subsequently Credit
Suisse First Boston or CSFB). Europay retained Merrill Lynch & Co. Mercer was
instructed to prepare and circulate a confidential term sheet.

     In September 2000, Mr. Boudreau and Dr. Richolt met by teleconference. They
primarily discussed the formula for the global proxy calculation, which would
become the benchmark for measuring the level of contribution made by the
European members to the combined company. The full negotiating teams met three
times in October 2000. Beginning with the second of these meetings, Robert
Selander, MasterCard's President and Chief Executive Officer, and Peter Hoch,
Europay's Chief Executive Officer, joined the negotiating teams. During these
meetings, the negotiating committees discussed a wide range of strategic and
operational issues, including the following:

     - the valuations of the organizations on a stand-alone and combined basis;

     - ways of measuring the relative contribution of the European members of
       MasterCard International to the business of the combined company;

     - the merits of a global proxy formula that recognized contributions to
       MasterCard International's gross dollar volume and gross acquiring volume
       compared to a formula that was strictly revenue-based;

     - the composition of the board of directors of the combined organization;

     - the level of authority that should be delegated to the regional boards
       and management;

     - the types of fundamental corporate matters that should not be changed
       without the approval of a supermajority of the board of directors or
       stockholders;

     - limitations on the assessability of memberships;

     - the benefits and detriments associated with converting MasterCard
       International to a stock corporation; and

     - the merits of a holding company structure.

     As the parties sought to reach a mutually acceptable understanding with
respect to the consideration to be received by the European members, they
concluded that it would be appropriate to implement a limited transition period
during which the projected level of contribution made to MasterCard's revenues
and transaction volume by the European members, as measured under the new global
proxy calculation, would be applied. The parties decided that the European
members would receive at the closing shares in a percentage amount that
represented what their contribution, as measured by the new global proxy
calculation, would have been if all of their volume were converted to MasterCard
and Maestro brand volumes. In its consideration of the aggregate allocation of
shares of MasterCard Incorporated between European and non-European members that
would result from the integration, MasterCard management developed a model to
project the final relative

                                        40
<PAGE>

regional distribution of shares at year-end 2003, which was the date then
expected for the completion of the share allocations resulting from the
integration. The model projected issuing volumes (GDV) and acquiring volumes
(GAV) by region, which were categorized by type for proxy purposes. European
member volumes and revenues were projected by Europay for the same periods. The
revenue figures that were shared with CSFB for use in connection with its
fairness opinion were not materially different from the revenue figures used in
the proxy analysis. Together, these projections formed the basis for the case
allocating an approximate 33.1% share of MasterCard Incorporated common stock to
European member-stockholders at the conclusion of the transition period.
MasterCard further reviewed these projections and made adjustments to reflect
lower projected revenue and lower conversion rates of ec Pictogram cards to
Maestro only cards during the transition period. MasterCard management used
these assumptions to generate a more conservative case. These adjusted
projections formed the basis for the case allocating an approximate 25.7% share
of MasterCard Incorporated common stock to European member-stockholders at the
conclusion of the transition period. MasterCard management also prepared an
upside case to measure the revenue and the converted ec Pictogram volumes that
would be required for European member-stockholders to own a 44% share of
MasterCard Incorporated common stock at the conclusion of the transition period.
To support that case, European member-stockholders would have to convert all ec
Pictogram cards to Maestro and would have to pay fees on the resulting volumes
generated by the end of the three-year transition period.

     Based on the projections of GDV, GAV, and revenues described above and
deemed to be reasonable by MasterCard International and Europay, the parties
concluded that it would be appropriate to allocate 33 1/3% of the total
outstanding shares to European members at the closing. Similarly, based on
projections of the likely best and worst case for European GDV, GAV and revenue
performance during the transition period, the parties concluded that it would be
appropriate to establish a minimum aggregate European shareholding percentage of
26% and a maximum aggregate European shareholding percentage of 44%, in each
case at the conclusion of the transition period. The European members could lose
some of the shares initially allocated at closing if, at the end of the
transition period, their contribution did not fulfill expectations, which would
most likely be attributable to lower volume conversion than anticipated.
Alternatively, if the contribution as of the end of the transition period
exceeded current expectations, they could receive additional shares, subject to
the maximum ownership percentage of 44%.

     The Europay negotiating team was also concerned about the position of the
European members as minority stockholders in a combined organization. MasterCard
understood these concerns, but felt it was important to strike a balance with
the general proposition that the will of the majority should prevail in
corporate governance matters. The parties agreed that any supermajority voting
requirements should be limited to matters relating to the fundamental
organizational and ownership structure of the combined company.

     At a meeting of the MasterCard International board held in November 2000,
members of the MasterCard International negotiating team and representatives
from Mercer reported that the two sides had made substantial progress. The
Mercer representatives made a presentation to the board concerning the latest
draft of the term sheet. The board engaged in a discussion about particular
aspects of the proposed terms. The board authorized the negotiating team to
proceed with the negotiations and to engage in a formal due diligence
investigation of Europay. Europay would undertake a similar investigation of
MasterCard International.

     The parties began their respective due diligence investigations in December
2000. The parties' due diligence covered financial, accounting, operations,
legal, human resources and other areas. Diligence was performed both on-site, at
the other party's principal offices, and off-site. The diligence process
continued for approximately two months.

     The MasterCard International and Europay negotiating teams met on December
6, 2000 and December 20, 2000, where they again discussed those matters in
MasterCard Incorporated's organizational documents that should be subject to
supermajority stockholder approval. These discussions continued at
teleconference meetings on January 5 and January 11, 2001. On January 16, 2001,
January 18, 2001 and January 22, 2001, the negotiating committees held
additional teleconference meetings in order to finalize the term sheet that
would be presented to the companies' respective boards of directors.

                                        41
<PAGE>

     The February 8, 2001 Board Meeting.  A special meeting of the MasterCard
International board was held on February 8, 2001 for the purpose of considering
and approving the term sheet. At this meeting, the board adopted resolutions
recommending the conversion and integration to MasterCard International's
members and approving the term sheet, and authorized the MasterCard
International negotiating team to seek to finalize negotiations with Europay.
The board also authorized the conversion of MasterCard International to a stock
corporation. The board considered the following matters at the February 8, 2001
meeting:

     - Representatives of Mercer made a presentation about the changes made to
       the term sheet since the November board meeting.

     - John De Lavis, the MasterCard executive in charge of the MasterCard
       International due diligence team, presented the findings of the diligence
       investigation.

     - Jerry McElhatton, MasterCard International's senior executive in charge
       of technology, made a presentation regarding plans for integrating the
       technology systems of the two companies.

     - Representatives of CSFB presented their relative allocation analysis to
       the MasterCard board and delivered their signed fairness opinion to
       MasterCard. CSFB's presentation and analyses, together with the CSFB
       fairness opinion, are described under the heading "Opinion of Financial
       Advisor to MasterCard International."

     In addition, Denise K. Fletcher, MasterCard International's Chief Financial
Officer, made a presentation at the February 8, 2001 board meeting regarding the
valuation, tax and accounting aspects of the integration and conversion. This
presentation also reviewed the text of certain prepared materials distributed to
the board relating to valuation in advance of the meeting. Mrs. Fletcher
reported on the valuation analysis by stating that management had developed
three scenarios representing the possible ownership of the combined entity by
European member-stockholders. She stated that the three scenarios were: (i) a
26% ownership case that represents the minimum guaranteed amount to the European
member-stockholders; (ii) a 33 1/3% ownership case based on projections provided
by Europay management; and (iii) a 44% ownership case that represents the
maximum amount that European member-stockholders could own of MasterCard
Incorporated regardless of performance. Mrs. Fletcher reported that, with
respect to the 26% case, MasterCard had been valued at approximately $1.6
billion and Europay at approximately $390 million using a 10.5% discount rate
and after applying a 50% reduction for both companies due to their private
ownership structure. Mrs. Fletcher also reported that MasterCard's and Europay's
management estimated that approximately $120 million in business synergies would
result from integration on an after-tax, net present value basis, using a 10.5%
discount rate and after applying the 50% private company discount. She reported
that, in the 26% case, the total value of the combined company after the
integration and including the synergies was estimated to be approximately $2.1
billion, using a 10.5% after-tax discount rate and after giving effect to the
50% private company discount. She stated that MasterCard management, in valuing
Europay, assigned 85% of the synergy savings to Europay because approximately
this portion (81%) of the synergies were expected to be derived from European
operations. She stated that under the 26% case the sum of the synergies and the
discounted cash flow value of the portion of Europay not presently owned by
MasterCard was estimated at approximately $430 million. She then said that
MasterCard management estimated that MasterCard would generate an after-tax
return on investment of 14.8%, 14.4% and 14% for the 26%, 33 1/3% and the 44%
cases, respectively, and that these returns were higher than the 10.5% cost of
capital estimated for MasterCard.

     Mrs. Fletcher then noted that the valuation analysis supported European
members owning 26% of MasterCard Incorporated after the conversion and
integration. She further noted that the initial allocation of 33 1/3% was
supported by the model reported by MasterCard management (with projections
regarding the Europe region coming from Europay management) referred to above.
According to the deal ultimately negotiated between the parties, European
member-stockholders would initially be allocated 33 1/3% of the common stock of
MasterCard Incorporated with a reallocation at the end of the three-year
transition period that adjusts European member-stockholder ownership to a level
between 26% and 44%, depending on actual performance of the Europe region.

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<PAGE>

     The information presented to the MasterCard International board on February
8, 2001 by CSFB and Mrs. Fletcher was supported by projections provided to CSFB
by MasterCard management that reflected management's best estimates for 2000
earnings and the 2001 budget. The projections also related to revenue and
operating income for the periods 2000 through 2004. The revenue projections
reflected the assumption that the economy could not continue to grow as it had
in the late 1990s and that revenue growth would slow as the global economy
decelerated. However, margins were expected to expand gradually reflecting
productivity gains, especially in transaction processing.

     Europay management also provided revenue, operating expense and operating
income projections regarding the Europe region to CSFB. These projections, along
with MasterCard management's projections for MasterCard International, formed
the basis for the case for allocating 33 1/3% of the common stock of MasterCard
Incorporated to European member-stockholders at the conclusion of the three-year
transition period. MasterCard management reviewed Europay's projections and
provided CSFB with adjusted projections, which reflected reduced revenue and
operating income estimates. This more conservative case formed the basis for the
case for allocating 26% of the common stock of MasterCard Incorporated to
European member-stockholders at the conclusion of the transition period.
MasterCard management also developed projections that would form the basis for
an upside case, which would allocate 44% of the common stock of MasterCard
Incorporated to European member-stockholders at the conclusion of the transition
period. MasterCard and Europay management also worked together to develop a
synergy plan which projected 81% of the savings being derived from European
operations, predominantly from staff savings and system integration synergies.

     In the fourth quarter of 2001, in connection with its delivery of the
fairness opinion dated January 16, 2002, MasterCard management provided CSFB
with updated projections for the periods from 2001 through 2004, and added 2005.
The updated projections reflected the following adjustments:

     - the most recent 2001 forecast was employed;

     - the most recent 2002 budget projections for Europay and MasterCard,
       reflecting the impact of the slowdown in the economy in general and the
       particular consequences of the events of September 11, 2001 were
       employed;

     - an assumption was made that, by the beginning of 2003, MasterCard and
       Europay would function at the same level that they would have functioned
       had the events of September 11, 2001 not occurred;

     - MasterCard management's projected 2005 Europay revenues, operating
       expenses, pre-tax income and EBITDA (earnings before interest, taxes,
       depreciation and amortization) were provided; and

     - MasterCard management's projected 2005 revenues, operating expenses,
       pre-tax income and EBITDA for MasterCard International were provided.

     MasterCard management also updated the synergy analysis based on the
integration planning and implementation that had taken place since CSFB's
fairness opinion of January 30, 2001.

     The Europay Board Meeting; Implementation Efforts.  On February 12, 2001,
the board of directors of Europay approved resolutions recommending the
integration to Europay's shareholders.

     During the months of February through May 2001, counsel for MasterCard
International and Europay prepared definitive documentation to effect the
conversion and integration. Numerous telephone conversations and meetings were
held among representatives of MasterCard International and Europay and their
legal advisors for the purpose of negotiating the definitive agreements.

     Forms of agreements were provided to the MasterCard International and
MasterCard Incorporated boards in advance of a special meeting called for May
16, 2001. At this meeting, the MasterCard International and MasterCard
Incorporated boards approved the forms of agreements and authorized management
to file the registration statement of which this proxy statement-prospectus
forms a part with the Securities and Exchange Commission. Subsequently, the
managements of MasterCard and Europay finalized the definitive agreements and
prepared the registration statement for filing.

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<PAGE>

     Statement Regarding Projections.  The preceding discussion under the
heading "The Integration -- Background of the Integration" contains certain
projections and forward-looking statements. MasterCard and Europay do not, as a
matter of course, make public projections as to future sales, earnings or other
results. The projections set forth above were not prepared with a view to public
disclosure or compliance with published guidelines of the Securities and
Exchange Commission or the guidelines established by the American Institute of
Certified Public Accountants regarding projections. Neither MasterCard's nor
Europay's independent auditors, nor any other independent accountants, have
compiled, examined or performed any procedures with respect to these
projections, nor have they expressed any opinion or other form of assurance with
respect to these projections or their achieveability, and assume no
responsibility for them. The inclusion of these projections in this document
should not be regarded as a representation by MasterCard or Europay or any of
their advisors, agents or representatives that these projections are or will
prove to be correct. Projections of this type are based on a number of
significant uncertainties and contingencies, all of which are difficult to
predict and most of which are beyond MasterCard's and Europay's control. As a
result, there can be no assurance that any of these projections will be
realized.

     The projections are or involve forward-looking statements, assume that the
conversion and integration have occurred and are based upon a variety of
assumptions, including MasterCard's and Europay's ability to achieve strategic
goals, objectives, and targets over the applicable period. These assumptions
involve judgments with respect to future economic, competitive and regulatory
conditions, financial market conditions and future business decisions, all of
which are difficult or impossible to predict accurately and many of which are
beyond MasterCard's and Europay's control. Many important factors, in addition
to those discussed elsewhere in this proxy statement-prospectus, could cause
MasterCard's and Europay's results to differ materially from those expressed or
implied by the forward-looking statements. Accordingly, there can be no
assurance that the projections are indicative of MasterCard's or Europay's
future performance or that actual results will not differ materially from those
in the projections set forth above. See "Cautionary Statement Regarding Forward
Looking Statements."

CONSIDERATIONS RELATING TO THE INTEGRATION

     In approving the integration, our board of directors considered a number of
advantages associated with the acquisition of Europay by MasterCard
Incorporated. The integration represents the opportunity for MasterCard to
enhance its global scope and payment programs by acquiring an important company
that operates in a desirable region of the world and has demonstrated success in
several key business functions. Specifically:

     - In 2001, the Europe region represented approximately 20% of MasterCard's
       worldwide gross dollar volume, not including Maestro and Cirrus
       transactions.

     - European countries are among the largest and most sophisticated payments
       markets in the world and represent a significant portion of the global
       payments industry.

     - Europay has demonstrated expertise in chip and debit programs and
       services, and in the ongoing development of new mobile commerce payment
       applications.

     The integration will also give MasterCard the opportunity to:

     - Establish a more consistent global marketing message, particularly in
       Europe, that is intended to increase MasterCard's presence in Europe and
       thereby make the Europe region more attractive to all MasterCard
       members.  Following completion of the integration, MasterCard will be
       better able to coordinate European marketing programs, enabling us to
       build our brands in Europe in concert with our global brand-building
       efforts. We expect that this increased coordination, combined with
       improved productivity, faster time to market and greater emphasis on
       customized solutions for members, should strengthen the presence of the
       MasterCard family of brands both in Europe and around the world.

     - Take advantage of Europay's expertise in debit and chip cards and mobile
       commerce.  Europay and Maestro have established in Europe a significant
       leadership in the debit and chip card arenas as well as in mobile
       commerce. Given the increasing use by cardholders globally of these
       applications, the skills

                                        44
<PAGE>

and knowledge already present at Europay in these areas will represent a key
strength for MasterCard, permitting the development of new business solutions.

     The integration represents the opportunity for Europay to merge with a
well-capitalized industry leader and, as a result, to leverage its own strengths
based on the broader resources of the MasterCard brand and organization. For
European members of the combined company, integration with MasterCard provides
additional opportunities to succeed in an increasingly competitive global
business, in which size, an existing network of members, and the ability to
develop quickly new and profitable products and services will likely
differentiate successful competitors.

     In particular, the integration with MasterCard provides European members
with the opportunity to:

     - Participate in the MasterCard system on a much more significant scale
       than they currently do.  After the conversion and integration, the
       European members will participate in MasterCard Incorporated as holders
       initially of 33 1/3% of its outstanding common stock, subject to change
       after the transition period, as more fully described in "Share Allocation
       and the Global Proxy."

     - Utilize MasterCard's expertise in brand building and customer-centered
       service.  Following completion of the integration, MasterCard's marketing
       team will coordinate with members and staff in the new Europe region to
       enhance brand-building efforts in that region. This is expected to result
       in increased brand awareness and higher usage and acceptance levels,
       making the European region stronger for all MasterCard members.
       Furthermore, European members will benefit from the reallocation of
       MasterCard's resources to deliver more customized relationship management
       and professional services.

     - Utilize MasterCard's expertise in marketing consulting, Internet and
       corporate expertise.  The integration will permit Europay to take
       advantage of MasterCard's marketing consulting expertise to further
       advance the European credit business. In addition, joining MasterCard's
       Internet experience with Europay's strengths in chip and mobile commerce
       should lead to the development of more electronic business solutions.
       Finally, Europay will be able to draw on the corporate resources of the
       larger MasterCard organization.

     To both MasterCard and Europay, the integration represents the opportunity
to merge separate businesses into one organization, with the resulting
opportunity to develop a stronger, combined operation and to:

     - Establish a global management team and governance structure.  The
       integration of the companies will provide an opportunity for a more
       cohesive and consistent global governance and management structure, which
       is currently divided among the MasterCard, Europay and Maestro
       organizations, each of which has separate governance requirements.
       Integrating MasterCard and Europay is also expected to result in a more
       rapid time to market for products due to enhanced decision-making and
       coordinated product development and management.

     - Establish improved delivery of customized relationship management and
       professional services.  As a result of the integration, we hope that the
       combined company will be in a position to deliver to European members
       more customized relationship management and professional services, such
       as marketing and operations consulting, to foster the growth and
       profitability of existing businesses and to facilitate the establishment
       of new payments programs and applications. In addition, we expect to join
       the technology operations of MasterCard and Europay to improve the
       flexibility, speed of change, interoperability and productivity of
       services provided to members, as well as to reduce costs. Finally,
       standardizing MasterCard's and Europay's programs and services should
       improve and make more consistent the quality of services delivered to
       members.

     - Achieve personnel and system synergies.  By combining the two companies,
       a greater pool of key personnel resources should be available to maintain
       and enhance our competitive advantages, including a wider array of
       customer, product and regional knowledge; technologies; marketing support
       and research; and stronger financial resources. In addition, we expect
       that, by integrating the two companies, we will be able to realize cost
       savings from integrating our transaction processing systems, eliminating
       overlapping staff functions and programs and by taking advantages of
       economies of scale.

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<PAGE>

     In approving the integration, our board of directors and the Europay board
of directors also considered the disadvantages of integration. The integration
may:

     - Create expected synergies that never materialize.  We may be unable to
       reduce costs, merge effectively our management structures or improve
       programs and professional services to our members in a timely or
       efficient manner. It may also prove difficult to streamline our
       technology or other operations, increase the customization and management
       of our member relationships and standardize our combined programs and
       services. Finally, we may not successfully combine personnel or systems
       resources or achieve economies of scale.

     - Cause significant dilution in the ownership of non-European members of
       MasterCard International. The integration will cause the ownership of the
       non-European members of MasterCard International in MasterCard
       Incorporated to be significantly diluted as compared to those members'
       current percentage of the total equity rights in MasterCard
       International.

     - Adversely impact some members through the introduction of the new global
       proxy formula.  Because the new global proxy formula considers additional
       factors (including GDV, GAV and revenues and volumes associated with
       Maestro and Cirrus cards) in allocating equity rights, it will dilute the
       ownership percentage of member-stockholders who are comparatively
       underweighted in such factors.

     No director or officer or any of their affiliates has a substantial
interest, direct or indirect, in the integration.

THE INTEGRATION AGREEMENT

     We summarize below the material terms and other provisions of the
integration agreement. The description is not complete, and we refer you to the
integration agreement, which is contained in Annex B of this proxy
statement-prospectus and which we have filed as an exhibit to the registration
statement of which this proxy statement-prospectus is a part.

EXCHANGE AND ALLOCATION OF SHARES


     The acquisition of Europay will be made pursuant to the Share Exchange and
Integration Agreement entered into by MasterCard Incorporated, MasterCard
International and Europay International, which we refer to as the integration
agreement. In connection with the integration agreement, each shareholder of
Europay (other than MasterCard International and MEPUK) has been required to
enter into a separate share exchange agreement with MasterCard Incorporated and
MasterCard International, pursuant to which it will exchange its Europay shares
for a specified number of shares of class A redeemable common stock and class B
convertible common stock of MasterCard Incorporated. In addition, the
shareholders of MEPUK have been required to enter into the MEPUK agreement with
MasterCard Incorporated and MasterCard International as described under the
heading "-- MEPUK" below, pursuant to which they will exchange their MEPUK
shares for a specified number of shares of class A redeemable common stock and
class B convertible common stock of MasterCard Incorporated. The integration
agreement also provides, as an integral component of the conversion and
integration, that the shares of class A redeemable and class B convertible
common stock of MasterCard Incorporated issued to the principal members of
MasterCard International and the shareholders of Europay and MEPUK will
initially be reallocated within each of the European and non-European member-
stockholder groups in accordance with the new global proxy calculation described
herein.


     The integration agreement defines how the European members of MasterCard,
including those members that are not shareholders of Europay, and the
non-European members of MasterCard, will be treated in the conversion and the
integration. For a description of the allocation of shares resulting from the
conversion and integration, see "Share Allocation and the Global Proxy."

CONDUCT OF BUSINESS PRIOR TO CLOSING OF INTEGRATION

     From the date of the integration agreement until the closing of the
integration, each of MasterCard Incorporated, MasterCard International and
Europay have agreed to conduct their respective businesses in the
                                        46
<PAGE>

ordinary course, consistent with past practice, and, among other things, to take
all commercially reasonable steps and to act in good faith in cooperation with
the other party to obtain all necessary government approvals. The parties also
have agreed to the restrictions summarized below.

     Europay has agreed that, except as may be required by law, unless
previously disclosed to MasterCard International or agreed to by MasterCard
Incorporated, it and its subsidiaries will not, and will not enter into an
agreement to, among other things:

     - increase the compensation of its officers, employees or consultants whose
       compensation is, or after giving effect to any change, would be, $100,000
       or more;

     - issue or sell any shares of its capital stock or its other equity
       interests;

     - declare or pay any dividend or other distribution on its capital stock or
       its other equity interests or redeem or purchase any of its capital stock
       or its other equity interests;

     - incur net new debt exceeding E15 million or prepaying any existing debt;

     - make capital expenditures or commitments exceeding E15 million.

     MasterCard Incorporated and MasterCard International have agreed that they
and their subsidiaries will not:

     - liquidate or dissolve themselves;

     - declare or pay any dividend or other distribution on its capital stock or
       other equity interests or redeem or purchase any capital stock or other
       equity interests; or

     - engage in a material business combination transaction unless it has been
       disclosed in this proxy statement-prospectus.

CONDITIONS TO CLOSING OF THE INTEGRATION

     MasterCard Incorporated's and MasterCard International's obligations, on
the one hand, and Europay's obligations, on the other hand, to complete the
integration are subject to satisfaction, or waiver by the other side, of the
following conditions:

     - each party's representations and warranties must be true on the date of
       the closing of the integration;

     - each party must have performed or complied with each of its respective
       agreements contained in the integration agreement;

     - there must not be, on the date of closing of the integration, any order
       or law prohibiting the closing of the integration or conversion or any
       action or proceeding to prohibit the integration before any governmental
       and regulatory authority, and all required consents and approvals with
       any governmental or regulatory authorities, in form and substance
       reasonably satisfactory to the other party, must have been obtained;

     - all consents or waivers to the performance by the parties to the
       integration agreement of their respective obligations under the
       integration agreement and all consents or waivers relating to contracts
       of the parties must be obtained in form and substance reasonably
       satisfactory to the other party;

     - the registration statement of which this proxy statement-prospectus forms
       a part must have been declared effective by the Securities and Exchange
       Commission and must not be subject to any stop order or proceeding by the
       Securities and Exchange Commission relating to a stop order; and

     - each party must have had delivered to the other opinions of counsel,
       officer's certificates, revised charter and bylaws and tax rulings from
       relevant tax authorities or related opinions of tax counsel, in each
       case, as specified in the integration agreement.

                                        47
<PAGE>

     In addition, MasterCard Incorporated's and MasterCard International's
obligations to complete the integration are subject to the satisfaction by
Europay, or the waiver by MasterCard Incorporated and MasterCard International,
of the following additional conditions:

     - the board of directors of Europay must have resigned, effective as of the
       date of the closing of the integration;

     - certain of the European members must have entered into an intellectual
       property assignment agreement, as specified in the integration agreement,
       confirming that Europay is the sole owner of the intellectual property
       rights associated with its brands;


     - each shareholder of Europay (other than MEPUK) must have entered into a
       share exchange agreement with MasterCard Incorporated and MasterCard
       International, as specified in the integration agreement, to transfer its
       shares of Europay capital stock to MasterCard Incorporated in exchange
       for class A redeemable common stock and class B convertible common stock
       of MasterCard Incorporated, as summarized above, and the MEPUK agreement
       described under the caption "-- MEPUK" below must have been entered into;


     - all Europay and MEPUK shareholders receiving shares in the integration
       must be principal members of MasterCard International prior to the
       closing of the integration; and

     - a satisfactory U.S. tax opinion from counsel or Internal Revenue Service
       ruling must have been received by MasterCard Incorporated.

     Finally, Europay's obligation to complete the integration is subject to the
satisfaction or waiver of the following additional conditions:

     - the merger agreement must have been executed; and

     - satisfactory tax opinions or rulings from applicable taxing authorities
       with respect to the tax consequences of the conversion and integration in
       certain non-U.S. jurisdictions must have been received.

     Any of the closing conditions to the integration, as described above, may
be waived by the parties to the integration agreement. Since the completion of
the integration is a condition to the conversion, if a material condition to the
integration is waived, MasterCard International will resolicit approval for the
conversion from its principal members.

     The form of the share exchange agreement referred to above is an exhibit to
the integration agreement, which is contained in Annex B to this proxy
statement-prospectus. We have also separately filed the form of share exchange
agreement as Annex C to this proxy statement-prospectus.

POST-CLOSING COVENANTS

     After the closing of the integration, the parties to the integration
agreement agree that:

     - MasterCard Incorporated will initiate and maintain a Global Center of
       Excellence in Waterloo, Belgium as the primary focus of global debit
       activities for three years, so long as it is commercially reasonable to
       do so;

     - MasterCard Incorporated will initiate a Global Center of Excellence for
       mobile commerce and chip products in Waterloo, Belgium for three years,
       so long as it is commercially reasonable to do so;

     - MasterCard will not prohibit the use of Eurocard as a program name so
       long as it is used in a manner consistent with any rules of MasterCard
       concerning the use of program names;

     - subject to the approval of the appropriate internal divisions, the
       parties intend that members will not experience any adverse impact on
       pricing or service levels as a result of a technical convergence; and

     - marketing support to the Eurocard brand in connection with its
       sponsorship of European football will continue until the European
       Football Championships in 2004.
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<PAGE>

TERMINATION

     The parties to the integration agreement may terminate it on any of the
following bases:

     - by mutual agreement of the parties for any reason;

     - in the event of a material breach by Europay, on the one hand, or
       MasterCard Incorporated and MasterCard International, on the other hand,
       that is not cured within five business days following notice of the
       breach or on notice by one party that the satisfaction of its obligations
       under the integration agreement has become impossible or impracticable
       despite the use of commercially reasonable efforts; and

     - at any time after June 30, 2002 if the closing of the integration has not
       occurred and this failure is not a result of a breach of the integration
       agreement by the terminating party.

ALLOCATION OF LIABILITY FOR BREACH

     The bylaws of MasterCard International provide that losses and liabilities
resulting from a breach of the representations and warranties of MasterCard
Incorporated, MasterCard International or Europay contained in the integration
agreement will be distributed equitably among MasterCard's six regions as an
expense. However, losses and liabilities related to a breach by either of
MasterCard Incorporated or MasterCard International of its representations and
warranties in the integration agreement exceeding $21 million in the aggregate
will be allocated solely to regions other than Europe. Conversely, losses and
liabilities related to a breach by Europay of its representations and warranties
in the integration agreement exceeding $7 million in the aggregate will be
allocated solely to Europe.

SUPERMAJORITY VOTING PROVISIONS

     After completion of the conversion and integration, approval of at least
75% of the directors present at a meeting at which a quorum is present and, in
certain cases, the holders of a majority of the outstanding class A redeemable
common stock and class B convertible common stock voting together as a single
class (so long as the class B convertible common stock has voting rights) will
be required to, among other things:

     - alter MasterCard Incorporated's status as a stock corporation;

     - amend the certificate of incorporation of MasterCard Incorporated to
       authorize MasterCard Incorporated to issue stock other than the class A
       redeemable, B convertible or C common stock;

     - sell, lease or exchange all or substantially all of MasterCard
       Incorporated's assets;

     - approve the sale, lease or exchange of all or substantially all of the
       assets of MasterCard International;

     - engage in a business combination (merger or consolidation) involving
       MasterCard Incorporated or MasterCard International;

     - undertake an initial public offering;

     - amend the MasterCard International certificate of incorporation to allow
       MasterCard International to issue capital stock, to create additional
       classes of membership interests in MasterCard International, to subject
       the property of the members of MasterCard International to the
       obligations of MasterCard International or to subject non-U.S. programs
       to the satisfaction of any liabilities arising from the current DOJ and
       merchant antitrust litigations in the United States;

     - amend the provisions of the MasterCard International bylaws relating to
       special assessments that may be imposed upon the members of MasterCard
       International;

     - make any modification to the bylaw provision stating the proportion of
       directors to come from each region;

     - alter MasterCard International's board seating methodology;

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     - change the definition of the global proxy calculation;

     - raise the limitation on voting for directors applicable to stockholders
       and their affiliates to greater than 15% of the outstanding voting stock
       entitled to be voted;

     - approve the issuance of voting class C common stock or class C common
       stock that, together with all other issuances of class C common stock
       made during the immediately preceding two years, represents greater than
       5% of the total number of shares of class A redeemable and class B
       convertible common stock outstanding prior to the issuance; and

     - modify any of these supermajority requirements.

     After completion of the conversion and integration, the following actions,
among others, will require approval of at least 66 2/3% of the directors present
at a meeting at which a quorum is present:

     - establishing or eliminating regional boards;

     - modifying MasterCard's internal regional cost allocation methodology;

     - modifying the bylaw provision setting forth the overall size of the
       MasterCard Incorporated board of directors;

     - approving the issuance of shares of class C common stock;

     - permitting a stockholder's ownership level to exceed 15%;

     - permitting the issuance of shares of class A redeemable or class B
       convertible common stock of MasterCard Incorporated in excess of the
       number of shares to which a stockholder would be entitled under the
       global proxy;

     - deciding to overrule a decision taken by a regional board that was
       permitted to be taken in accordance with the bylaws;

     - deciding to overrule a recommendation made by the Debit Advisory Board
       that was permitted to be taken in accordance with the bylaws; and

     - modifying any of these supermajority requirements.

     More detailed supermajority voting provisions are contained in the
certificates of incorporation and bylaws of each of MasterCard Incorporated and
MasterCard International. See "Description of Capital Stock of MasterCard
Incorporated" and "Comparison of Rights of MasterCard International Members
Before and After the Conversion and Integration."

MEPUK

     One of the shareholders of Europay is MasterCard/Europay U.K. Limited
("MEPUK"), a company formed by certain financial institutions in the United
Kingdom for the purpose of holding their shares in Europay. MEPUK also manages
rules applicable to the domestic settlement of MasterCard-branded transactions
by financial institutions in the United Kingdom.

     In lieu of the share exchange procedures described elsewhere in this proxy
statement-prospectus, the shareholders of MEPUK have been required to enter into
a related share exchange agreement with MasterCard Incorporated pursuant to
which they will exchange all their MEPUK shares for shares of common stock of
MasterCard Incorporated. As a result of this transaction, MEPUK will become a
wholly-owned subsidiary of MasterCard Incorporated and will continue to hold
shares of Europay. Currently, each shareholder of MEPUK is a shareholder in
Europay through its ownership in MEPUK. In addition, at the time of the closing
of the conversion and integration, all of the shareholders of MEPUK will be
principal members of MasterCard International.

     On or before the closing of the integration, MEPUK will distribute to its
shareholders or otherwise cause to be discharged any and all assets and
liabilities of MEPUK, other than its shares in Europay. In addition, the

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existing MEPUK shareholders will transfer MEPUK's responsibilities for the U.K.
domestic rules and other operations to a new entity that is not affiliated with
MasterCard Incorporated. Accordingly, at the time of the closing of the
conversion and integration, MEPUK will have no operations and its sole purpose
will be to hold Europay shares.

     In the MEPUK agreement, the MEPUK shareholders have agreed to indemnify
MasterCard Incorporated and MasterCard International for any liability of MEPUK
that relates to the period up to and including the closing of the integration.
MasterCard Incorporated has also agreed to distribute to the MEPUK shareholders,
net of any taxes or liabilities, any assets of MEPUK (other than the Europay
shares) not distributed prior to the closing of the integration. The MEPUK
agreement is filed as an exhibit to the registration statement of which this
proxy statement-prospectus forms a part.

BRAND MIGRATION

     MasterCard Incorporated, MasterCard International and/or Europay intend to
enter into one or more brand migration agreements with principal members in
Europe, including EKS in Germany, pursuant to which, among other things,
MasterCard and Europay will provide support for marketing initiatives designed
to migrate all uses of the Eurocard-MasterCard brand mark on cards, acceptance
decals, advertising and other materials to the MasterCard brand mark.

ACCOUNTING TREATMENT OF THE INTEGRATION

     We anticipate that the integration will be accounted for under the purchase
method of accounting in accordance with accounting principles generally accepted
in the United States. The excess of purchase price over the fair value of
tangible and identifiable intangible assets less liabilities will be recorded as
goodwill. Goodwill and other intangible assets resulting from the integration
that have indefinite useful lives will not be amortized, but will be tested for
impairment at least annually.

     In the Europay share exchange, stockholders of Europay and MEPUK, other
than MasterCard International, will exchange their shares of Europay and MEPUK
for 23.76 million shares of MasterCard Incorporated. The transaction provides
that the number of shares allocated to former shareholders of Europay and MEPUK
will increase or decrease at the end of the transition period as a result of the
application of the global proxy formula for the third year of the transition
period. See "Share Allocation and the Global Proxy." In accounting for the
initial purchase price of Europay, MasterCard will not consider shares above the
minimum number of shares allocable to Europay and MEPUK shareholders at the end
of the transition period because only the minimum number of shares is issued
unconditionally at the closing to such shareholders. Of the 23.76 million shares
attributable to the exchange of Europay and MEPUK shares, 6.15 million shares
are conditional shares subject to reallocation at the end of the transition
period and allocable to Europay and MEPUK shareholders. Europay and MEPUK
shareholders are therefore receiving 17.61 million unconditional shares at
closing. The value of each MasterCard Incorporated share, immediately before the
exchange, is estimated to be $15.21 based on an independent appraisal.
Accordingly, MasterCard's purchase price for the shares of Europay is estimated
to be $267.9 million.

     Since former Europay and MEPUK shareholders would retain or receive shares
of MasterCard Incorporated at the end of the transition period without remitting
any additional consideration, any shares retained or received by them that are
above their minimum allocation at that time would constitute part of the
purchase price. Any such additional shares would be valued at that time based
upon the fair value of the stock of MasterCard Incorporated. Any such
reallocation of shares to former Europay and MEPUK shareholders will increase
the purchase price for Europay and, accordingly, the amount of goodwill and
additional paid-in-capital recorded. The unaudited pro forma combined financial
information does not give effect to any potential contingent consideration.

     With respect to the manner in which they account for their equity interest
in MasterCard, members should consult their financial advisors regarding the
potential accounting implications of the integration.

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REGULATORY MATTERS RELATING TO THE INTEGRATION

     Within the European Union, transactions falling under the European
Commission's merger regulations require prior notification and regulatory
approval. The proposed integration amounts to a concentration within the meaning
of the European Commission merger regulations because it will entail a change of
control of Europay. However, because the consolidated worldwide revenue of
MasterCard and Europay is below the threshold stipulated by the regulations,
prior notification and regulatory approval will not be required at the European
Commission level. Notwithstanding this, Europay has informed the European
Commission of the integration for informational purposes.

     A number of countries within the European Union require notification and
prior regulatory approval depending upon whether the national merger control
thresholds are met or not. National merger control thresholds can relate to the
national and worldwide revenues of the parties and/or to their market share in
the country in question, with thresholds for market share ranging from 20% to
35%. National notification was necessary in Germany and Finland on the basis of
revenue and in Spain and Greece on the basis of national market share. As of the
date of this proxy statement-prospectus, the transaction has been cleared by the
national competition authorities in each of these countries.

     Certain members of MasterCard International and certain shareholders of
Europay that receive shares of MasterCard Incorporated in the transactions may
be required to make filings under the HSR Act if the fair market value of their
MasterCard Incorporated shares exceeds $50 million and they do not intend to
hold those shares solely for investment purposes. Members should consult their
advisors to determine whether they are required to make any filings under the
HSR Act. The completion of both the conversion and the integration would be
subject to the expiration or termination of all waiting periods for which
filings will be made with the U.S. antitrust agencies under the HSR Act, in
connection with both transactions.

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                     SHARE ALLOCATION AND THE GLOBAL PROXY

INTRODUCTION

     Since the mid 1990s, the global proxy formula used by MasterCard
International to allocate equity rights at annual meetings of members has been
based solely on revenue received by MasterCard International on MasterCard
transactions. In connection with the conversion and integration, MasterCard
Incorporated will migrate to a new global proxy formula designed to take a more
comprehensive, balanced account of the contributions of member-stockholders to
MasterCard's business. In particular, the new global proxy calculation will
measure each member-stockholder's contribution to three key elements of
MasterCard's business -- gross dollar volume ("GDV"), gross acquiring volume
("GAV") and revenue -- and will also account for revenue and volume earned
principally in connection with MasterCard, Maestro and Cirrus-branded cards.
Revenue will account for one half, and GDV and GAV will each account for one
fourth, of the new global proxy calculation.

     The new global proxy calculation will be used for three purposes. First, in
conjunction with the apportionment of MasterCard Incorporated shares between
members within Europe and members outside of Europe described below, it will be
used to determine the initial allocation of shares to member-stockholders upon
the closing of the conversion and integration. Second, the new global proxy
calculation will be used to determine the reallocation of MasterCard
Incorporated shares among member-stockholders at the end of the three-year
transition period following the closing of the conversion and integration, also
in conjunction with the apportionment of shares between Europe and non-Europe
described below. Finally, it will be used on an ongoing basis to determine the
maximum number of shares of MasterCard Incorporated that a member-stockholder
may own and the minimum number of shares of MasterCard Incorporated that a
member-stockholder will be required to own. MasterCard Incorporated's
calculation of the global proxy for each member-stockholder will be considered
final and binding unless the board of directors determines that an error was
made in the computation, in which case the computation will be corrected in
accordance with directions of the board.

     In connection with the initial allocation of shares, the relevant period
for calculating the new global proxy will be the 12 month period ended December
31, 2000. (In contrast, the last global proxy using the historical, revenue-only
formula was calculated for the 12 month period ended September 30, 2001.) All
subsequent calculations of the new global proxy will be made on the basis of
each successive 12 month period beginning on the first business day of the
fiscal quarter following the closing of the conversion and integration. All
global proxy calculations will be made on an accrual basis of accounting. (In
contrast, the historical global proxy formula was calculated on a cash basis of
accounting). The board of directors of MasterCard Incorporated is empowered to
establish a record date in connection with each global proxy calculation for
purposes of determining the stockholders of record whose GDV, GAV and revenue
will be included in determining the relevant global proxy.

     The new global proxy formula and the regional apportionment of shares are
described in the integration agreement and in the by-laws of MasterCard
Incorporated. Matters relating to the ec Pictogram shares are described
principally in the integration agreement.

     THE NEW GLOBAL PROXY FORMULA WILL ONLY TAKE ACCOUNT OF REVENUES AND VOLUMES
CONTRIBUTED BY PRINCIPAL MEMBERS OF MASTERCARD INTERNATIONAL, INCLUDING
AFFILIATE MEMBERS WHO PARTICIPATE INDIRECTLY IN THE MASTERCARD BUSINESS THROUGH
PRINCIPAL MEMBERS, CONSISTENT WITH THE HISTORICAL GLOBAL PROXY CALCULATION.
AFFILIATE MEMBERS WILL NOT RECEIVE ANY SHARES IN THE CONVERSION AND INTEGRATION,
BUT PRINCIPAL MEMBERS OF MASTERCARD INTERNATIONAL WILL RECEIVE SHARES BASED ON
THE NEW GLOBAL PROXY FORMULA THAT REFLECTS REVENUES AND VOLUMES CONTRIBUTED BY
THEIR RESPECTIVE AFFILIATES. FINANCIAL INSTITUTIONS THAT ARE MEMBERS OF MAESTRO
INTERNATIONAL INCORPORATED OR CIRRUS SYSTEMS, INC. BUT ARE NOT ALSO PRINCIPAL
MEMBERS OR AFFILIATES OF PRINCIPAL MEMBERS OF MASTERCARD INTERNATIONAL WILL NOT
RECEIVE ANY SHARES IN THE CONVERSION AND INTEGRATION BUT WILL BE ELIGIBLE TO
RECEIVE SHARES AT THE CONCLUSION OF THE TRANSITION PERIOD IF THEY APPLY FOR, AND
ARE GRANTED, PRINCIPAL MEMBERSHIP IN MASTERCARD INTERNATIONAL DURING THE
TRANSITION PERIOD AND ARE ALLOCATED SHARES OF MASTERCARD

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INCORPORATED DURING THE TRANSITION PERIOD IN ACCORDANCE WITH THE PROCEDURE
DESCRIBED AT THE END OF THE NEXT PARAGRAPH.

     ON THE CLOSING DATE OF THE CONVERSION AND INTEGRATION, EACH PRINCIPAL
MEMBERSHIP INTEREST IN MASTERCARD INTERNATIONAL WILL BE AUTOMATICALLY CONVERTED
INTO A CLASS A MEMBERSHIP INTEREST IN MASTERCARD INTERNATIONAL AND SHARES OF
COMMON STOCK OF MASTERCARD INCORPORATED. HOWEVER, TO RECEIVE SHARES AT CLOSING,
A MEMBER MUST, IN ADDITION TO QUALIFYING AS A PRINCIPAL MEMBER ON THE CLOSING
DATE, HAVE CONTRIBUTED REVENUES AND/OR VOLUMES TO MASTERCARD INTERNATIONAL AS A
PRINCIPAL MEMBER DURING THE 12 MONTH PERIOD ENDED DECEMBER 31, 2000 THAT ARE
ELIGIBLE TO BE CONSIDERED UNDER THE NEW GLOBAL PROXY FORMULA DESCRIBED HEREIN.
IF NO SUCH REVENUES OR VOLUMES WERE CONTRIBUTED, A PRINCIPAL MEMBER WILL
PARTICIPATE IN THE CONVERSION BUT WILL NOT RECEIVE SHARES OF COMMON STOCK OF
MASTERCARD INCORPORATED AT THE CLOSING. THE MASTERCARD INCORPORATED BOARD OF
DIRECTORS EXPECTS TO ADOPT PROCEDURES TO ISSUE SHARES OF MASTERCARD INCORPORATED
COMMON STOCK TO PRINCIPAL MEMBERS DURING THE TRANSITION PERIOD THAT DID NOT
QUALIFY TO RECEIVE SHARES AT CLOSING, IN ORDER TO PERMIT SUCH MEMBERS TO
PARTICIPATE IN THE REALLOCATION OF MASTERCARD INCORPORATED SHARES THAT WILL
OCCUR AT THE CONCLUSION OF THE TRANSITION PERIOD.

THE GLOBAL PROXY

     The Formula.  For each member-stockholder, the global proxy calculation
will be equal to the sum obtained by adding (A) .25 multiplied by a fraction,
the numerator of which is the member-stockholder's GDV and the denominator of
which is MasterCard Incorporated's total GDV attributable to all member-
stockholders, plus (B) .25 multiplied by a fraction, the numerator of which is
the member-stockholder's GAV and the denominator of which is MasterCard
Incorporated's total GAV attributable to all member-stockholders, plus (C) .50
multiplied by a fraction, the numerator of which is the sum of (1) all
non-travelers cheque revenues paid by the member-stockholder to MasterCard
Incorporated and its subsidiaries and (2) two times the travelers cheque
revenues paid by the member-stockholder to MasterCard Incorporated and its
subsidiaries, and the denominator of which is the sum of (1) all non-travelers
cheque revenues paid by all member-stockholders to MasterCard Incorporated and
its subsidiaries and (2) two times the travelers cheque revenues paid by all
member-stockholders to MasterCard Incorporated and its subsidiaries, in each
case for the applicable period. Travelers cheque programs shall be deemed to
have no GDV or GAV for purposes of the global proxy calculation. Only actual, as
opposed to estimated, GDV, GAV and revenues paid will be considered for purposes
of the global proxy calculation. In addition, for purposes of the global proxy
calculation:

     - GDV.  GDV means processed and non-processed issued volumes (including
       domestic and international retail purchases, cash transactions,
       convenience checks, on-us transactions, intra-processor transactions,
       local use only transactions and balance and commercial funds transfers)
       that occur as a result of one or more of (A) a transaction involving any
       one of MasterCard Incorporated's brands (e.g., MasterCard, Eurocard,
       Maestro, Cirrus and ec Pictogram) or (B) a non-MasterCard branded
       transaction involving a card that includes any one of MasterCard
       Incorporated's brand logos as well as other payment brand logos, provided
       that such other payment brands are not in direct competition with any
       MasterCard brands as determined by MasterCard Incorporated.

     - GAV.  GAV means processed and non-processed acquired volumes (including
       domestic and international retail purchases, cash transactions, on-us
       transactions, intra-processor transactions and local use only
       transactions) that occur as a result of one or more of (A) a transaction
       involving any one of MasterCard Incorporated's brands (e.g., MasterCard,
       Eurocard, Maestro, Cirrus and ec Pictogram) or (B) a non-MasterCard
       branded transaction involving a card that includes any one of MasterCard
       Incorporated's brand logos as well as other payment brand logos, provided
       that such other payment brands are not in direct competition with any
       MasterCard brands as determined by MasterCard Incorporated.

     - Revenue.  Revenues paid for a particular member-stockholder are, for any
       period, all revenues of MasterCard Incorporated on a consolidated basis,
       calculated in accordance with U.S. GAAP, that are generated by the
       activities of that member-stockholder, other than (1) any fees or other
       charges

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       associated with the termination of that member-stockholder's membership
       in MasterCard International, (2) integration-related assessments paid by
       that member-stockholder, (3) other assessments, fees and charges paid by
       that member-stockholder in its capacity as a member of MasterCard
       International if those assessments, fees and charges were imposed on less
       than all of the members of MasterCard International (except for
       assessments, fees and charges pertaining to business development,
       ordinary course of business and other matters deemed to be includable by
       the management of MasterCard International in management's sole
       discretion) and (4) fines and penalties paid by that member-stockholder
       (except as determined includable in the sole discretion of the management
       of MasterCard International). For purposes of the initial allocation of
       shares associated with the closing of the conversion and integration,
       MasterCard intends generally to include fines and penalties in the
       calculation of revenues paid, except for termination fees.

     - Card Fee Assessment.  A card fee assessment means a bona fide, non de
       minimis fee expressed as a fixed amount in connection with a card.

     - Volume-based Assessment.  A volume-based assessment means a bona fide,
       non de minimis assessment typically expressed as a percentage of the GDV
       or GAV associated with a particular type of transaction.

     GDV and GAV Volume Weightings.  In calculating GDV and GAV, each
member-stockholder's volume must be broken into four categories, each of which
is weighted differently for purposes of the calculation, as described below. The
weighted categories are designed to reflect the relative value of different
activities to MasterCard's overall business, and provide the highest recognition
to transactions that are fully assessed by MasterCard based on volume. Volumes
attributable to transactions involving only card-based assessments are accorded
relatively lower weight. Volumes are included in the global proxy calculation
whether they are assessed directly or the cards to which they relate are subject
to card fee assessments of the type contemplated by the applicable category of
volume. In addition, for each global proxy calculation performed prior to the
expiration of the transition period, volumes in the following categories will be
included even if they are not subject to volume-based or card fee assessments.
Finally, the volume weightings give significant credit to ec Pictogram-branded
volumes (a regional debit brand owned by Europay) and other similar debit
volumes, provided they have been converted to the Maestro brand or are the
subject of binding written commitments to convert to Maestro. Ordinarily, the
global proxy formula accounts only for volumes associated with MasterCard's
principal brands -- MasterCard, Maestro and Cirrus. As a result of negotiations
with Europay, proxy weightings have been extended to ec Pictogram and similar
regional debit volumes to give credit for the significant business currently
done under those brands in Europe. The conversion commitment has also been
implemented to encourage members to consistently migrate those volumes to
MasterCard's principal brands in the future. The ec Pictogram brand will be
owned by MasterCard Incorporated following the conversion and integration.

     - Volumes Weighted at 100%.  All of the following volumes are weighted at
       100% of actual volume: (1) volumes on cards that include a MasterCard
       brand logo and that are subject to volume-based assessments or card fee
       assessments, (2) Maestro and Cirrus processed debit volumes and (3)
       Maestro and Cirrus debit volumes that are subject to volume-based
       assessments, so long as Maestro, a brand representing a stored value
       application that is permitted to be used by members of MasterCard
       International and/or Cirrus is the sole acceptance brand on the card.

     - Volumes Weighted at 75%.  The following volumes are weighted at 75% of
       actual volume: ec Pictogram volumes and other similar debit volumes that
       in each case have been converted to Maestro volumes so long as Maestro, a
       brand representing a stored value application that is permitted to be
       used by members of MasterCard International and/or Cirrus is the sole
       acceptance brand on the card and the card is subject to card fee
       assessments.

     - Sliding Scale of Weightings for Certain Regional Debit Volumes.  Volumes
       for regional debit brands owned (or in the case of the initial allocation
       of shares to be owned) solely by MasterCard Incorporated on cards that
       include a Maestro and/or Cirrus logo are weighted at the following
       percentages for the period indicated; provided that such cards are
       subject to volume-based assessments

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       or card fee assessments; and provided, further, that for calculations for
       the last year of the transition period through the year ending on the
       second anniversary of the end of the transition period, there is a
       binding written commitment to remove all acceptance brand logos other
       than the Maestro brand logo, the Cirrus brand logo or the logo of a brand
       representing a stored value application that is permitted to be used by
       members of MasterCard International, on the cards not later than the
       fifth anniversary of the first fiscal quarter beginning after the fiscal
       quarter in which the closing of the conversion and integration occurs:

      - 10% of such volumes for all calculations until the last year of the
        transition period;

      - 40% of such volumes for the last year of the transition period;

      - 30% of such volumes for the year ending on the one-year anniversary of
        the end of the transition period;

      - 20% of such volumes for the year ending on the two-year anniversary of
        the end of the transition period; and

      - 10% of such volumes for subsequent years.

     - Volumes Weighted at 1%.  Volumes for (i) regional debit brands not owned
       by MasterCard Incorporated on cards that include a Maestro and/or Cirrus
       brand logo and are subject to volume-based assessments or card fee
       assessments and (ii) balance and commercial funds transfers relating to
       cards that are subject to volume-based or card fee assessments are
       weighted at 1%.

     Currency Conversion.  In performing the global proxy calculation, the
conversion of euros to U.S. dollars, to the extent necessary, will be based on
the average exchange rate during the twenty-day period ending on the day prior
to the applicable measurement date, which we refer to as the average currency
conversion rate, provided that during the transition period and for the two
years thereafter the average currency conversion rate shall be $.9565 U.S. = 1
euro for so long as 1 euro is not less than $.9065 U.S. and not greater than
$1.0065 U.S. In the event that the average currency conversion rate does not
fall within this range, the rate to convert euros to U.S. dollars will be $.9565
U.S. = 1 euro adjusted by the difference between such average currency
conversion rate and the upper or lower limit of the range, as applicable.

     For purposes of determining the global proxy calculation during the
transition period and for the two years thereafter, amounts denominated in the
currency of a country within the Europe region other than the euro will first be
converted into euros and subsequently converted into U.S. dollars in accordance
with the previous paragraph.

     Travelers Cheques.  The revenue component of the global proxy formula
provides that MasterCard International's travelers cheque members will calculate
their respective global proxies using 100% of revenues paid by them to
MasterCard Incorporated and its subsidiaries in connection with their travelers
cheque programs (in other words, revenues for travelers cheque members are
doubled before being discounted by the 50% factor set forth in the global proxy
formula). However, travelers cheque members will not receive credit for GDV or
GAV in connection with their global proxy calculations, as the integration
agreement provides that GDV and GAV will be deemed to be zero for travelers
cheque programs.

THE INITIAL ALLOCATION OF SHARES

     The allocation of shares of MasterCard Incorporated to each
member-stockholder upon the closing of the conversion and integration will be
determined in accordance with the detailed procedures described in the merger
agreement, the integration agreement and the by-laws of MasterCard Incorporated.
The new global proxy formula based on the 12 month period ended December 31,
2000, applied on a regional basis to Europe and non-Europe, will determine the
number of shares that members receive initially in the conversion and
integration. However, this outcome is the result of an integrated series of
transaction steps in the conversion and integration, as described more fully
below.

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     Shares Issued in the Conversion.  In the conversion, each principal member
of MasterCard International, including each MasterCard principal member in
Europe, will receive a number of shares of class A redeemable and class B
convertible common stock of MasterCard Incorporated that is proportional to the
percentage of the total equity rights in MasterCard International that such
member held in accordance with the historic proxy formula in effect for the
period ended September 30, 2000. The historic global proxy calculation will be
used to determine the shares allocated in the conversion step only and will have
no further bearing on the outcome of the transaction.

     Shares Issued in the Integration.  In the integration, each shareholder of
Europay and MEPUK will receive a number of shares of class A redeemable and
class B convertible common stock of MasterCard Incorporated in exchange for its
shares of Europay or MEPUK, as the case may be, as specified in the share
exchange agreement and MEPUK agreement, respectively. To the extent practicable,
the shares issued in the integration step will be proportional to each
shareholder's direct (in the case of Europay shareholders) or indirect (in the
case of MEPUK shareholders) prior interest in Europay. Because all Europay and
MEPUK shareholders will be principal members of MasterCard International at the
closing of the conversion and integration, the issuance of additional shares in
the integration will have the effect, when taken together with the shares issued
in the conversion, of allocating 33 1/3% of the total shares of class A
redeemable and class B convertible common stock then outstanding to European
members. Accordingly, the shares issued in the integration will have the result
of diluting current non-European members' ownership from approximately 93% of
MasterCard International before the conversion and integration to 66 2/3% of
MasterCard Incorporated after the conversion and integration.

     Initial Reallocation of Shares Pursuant to the Global Proxy
Calculation.  At the closing of the conversion and integration, the shareholders
of Europay and MEPUK will be principal members of MasterCard in Europe.
Accordingly, the share issuances described above in connection with the
conversion and integration will produce in the aggregate two pools of shares,
one for European member-stockholders and the other for non-European
member-stockholders. The integration agreement provides that the shares of class
A redeemable and class B convertible common stock will then initially be
reallocated within each of the European and non-European pools of shares in
accordance with the new global proxy formula. This reallocation will occur as an
integral component of, and contemporaneously with, the closing of the conversion
and integration. Accordingly, the new global proxy formula will determine the
number of shares that members ultimately receive in the conversion and
integration; the number of shares received by European members may vary across
members compared to the number of Europay and/or MEPUK shares exchanged. Based
on the new global proxy calculation, each member-stockholder in Europe will be
entitled to a percentage of the European shares equivalent to the percentage
that its aggregate GDV, GAV and revenue represents of the total GDV, GAV and
revenue for Europe, using the methodology of the new global proxy. Similarly,
outside of Europe, each member-stockholder will be entitled to a percentage of
the non-European shares equivalent to the percentage that its aggregate GDV, GAV
and revenue represents of the total GDV, GAV and revenue outside of Europe,
using the methodology of the new global proxy.

     The accompanying proxy card sets forth the number of class A redeemable and
class B convertible shares of MasterCard Incorporated common stock that you, as
a current principal member of MasterCard International, will receive upon the
closing of the conversion and integration (including in connection with the
initial reallocation of shares described above). For principal members that are
also shareholders of Europay or MEPUK, the number of shares reported on the
proxy card includes all shares issued in connection with the acquisition of
their Europay or MEPUK stock in the integration. Principal members should note
that the number of shares set forth on the proxy card may be adjusted to reflect
changes in the attribution of ICA numbers to principal members or the
termination of principal members prior to the closing date of the conversion and
integration. ICA numbers are the primary method used by MasterCard International
to attribute revenues and volumes associated with card activity to members for
proxy and other purposes. For example, if a principal member acquires ownership
of an ICA number from another principal member prior to the closing date but
after the date used to calculate share ownership information for the proxy card,
the shares to be issued in respect of the revenues and volumes related to that
principal ICA number will be distributed to

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<PAGE>

the purchasing member on the closing date, and the selling member will receive a
corresponding fewer number of shares as compared to the information printed on
its proxy card.

     Member-stockholders other than travelers cheque members can also estimate
the aggregate number of class A redeemable and class B convertible shares of
MasterCard Incorporated to be allocated to them at the closing of the conversion
and integration using their own revenue and weighted GDV and GAV data and the
following figures:

     For the 12 months ended December 31, 2000:


<Table>
            <S>                                                           <C>
            Aggregate Weighted European GDV (gross euro issuing volume):  E304.0 billion
            Aggregate Weighted European GAV (gross euro acquiring
              volume):                                                    E303.6 billion
            Aggregate European Revenue:                                   E355.2 million
            Aggregate Weighted non-European GDV:                          $548.9 billion
            Aggregate Weighted non-European GAV:                          $535.9 billion
            Aggregate non-European Revenue:                               $1,349.5 million
</Table>


     The formula to be applied with these figures is as follows:

<Table>
<S>  <C>                             <C>  <C>                           <C>  <C>
     (0.5)(Revenue paid by Member)        (0.25)(Member Weighted GDV)        (0.25)(Member Weighted GAV)
                                      +                                  +
     -----------------------------        ---------------------------        ---------------------------
           Aggregate Revenue                Aggregate Weighted GDV             Aggregate Weighted GAV
</Table>

For purposes of this calculation, European members should use the aggregate
European figures and non-European members should use the aggregate non-European
figures. For ease of calculation, this formula does not account for travelers
cheque revenues and, as such, produces an estimated result only. However,
travelers cheque revenues do not have a material impact on the proxy calculation
for principal and association members that are not also travelers cheque
members. Travelers cheque members should consult the formula described under the
caption "The Global Proxy -- The Formula" and set forth in the integration
agreement to prepare an estimate of the aggregate number of shares of class A
redeemable and class B convertible common stock of MasterCard Incorporated to be
allocated to them.

     The foregoing formula produces a percentage that can be multiplied by the
number of shares in the applicable pool of shares to derive an estimate of the
number of shares to be received in the conversion and integration. A description
of the total number of shares allocated to each pool is provided below.

     For all members, 84% of the shares received will be in the form of class A
redeemable common stock and 16% of the shares received will be in the form of
class B convertible common stock. In addition, as discussed above, the shares
issued upon the closing of the conversion and integration will result in
European member-stockholders receiving shares of class A redeemable and class B
convertible common stock that together represent 33 1/3% of all of the shares of
class A redeemable common stock and class B convertible common stock together
outstanding. The shares of class A redeemable common stock issued to the
European member-stockholders will represent 28%, and the shares of class B
convertible common stock issued to the European member-stockholders will
represent 5 1/3%, of the respective total number of shares of class A redeemable
common stock and class B convertible common stock together outstanding
immediately after the closing of the conversion and integration. The remaining
class A redeemable and class B convertible common stock, representing in the
aggregate 66 2/3% of the class A redeemable and class B convertible common stock
together outstanding, will be held by the non-European member-stockholders of
MasterCard. The shares of class A redeemable common stock issued to the
non-European member-stockholders will represent 56%, and the shares of class B
convertible common stock issued to the non-European member-stockholders will
represent 10 2/3%, of the total number of shares of class A redeemable common
stock and class B convertible common stock together outstanding immediately
after the closing of the conversion and integration.

                                        63
<PAGE>

     Accordingly, immediately after the closing of the conversion and
integration, shares of MasterCard Incorporated class A redeemable and class B
convertible common stock will be allocated as follows:

<Table>
<Caption>
                                                 EUROPEAN      NON-EUROPEAN
                                                  MEMBER          MEMBER       TOTAL SHARE
                                               STOCKHOLDERS    STOCKHOLDERS    DISTRIBUTION
                                               ------------    ------------    ------------
<S>                                            <C>             <C>             <C>
class A redeemable...........................   28,000,000      56,000,000      84,000,000
class B convertible..........................    5,333,333      10,666,667      16,000,000
                                                ----------      ----------     -----------
          Total..............................   33,333,333      66,666,667     100,000,000
                                                ==========      ==========     ===========
</Table>

     For the purposes of the global proxy calculation, European
member-stockholders constitute those member-stockholders whose revenue and
volume is generated from activity from and in Europe. Europe is defined to
include the following countries: Albania, Andorra, Armenia, Austria, Azerbaijan,
Belarus, Belgium, Bosnia-Herzegovina, Bulgaria, Channel Islands, Croatia,
Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Georgia, Germany,
Gibraltar, Greece, Hungary, Iceland, Ireland, Israel, Italy, Kazakhstan,
Kyrgyzstan, Latvia, Liechtenstein, Lithuania, Luxembourg, Macedonia (former
Yugoslav Republic), Malta, Moldova, Monaco, Netherlands, Norway, Poland,
Portugal, Romania, Russian Federation, San Marino, Slovakia, Slovenia, Spain,
Sweden, Switzerland, Tajikistan, Turkey, Turkmenistan, Ukraine, United Kingdom,
Uzbekistan, Vatican City and Yugoslavia (Serbia and Montenegro).

REALLOCATION OF SHARES AT THE CONCLUSION OF THE TRANSITION PERIOD

     During the three year transition period after the closing of the conversion
and integration, the member-stockholders will be entitled to the class A
redeemable and class B convertible common stock that they held as of the closing
of the transaction, regardless of changes in the respective global proxy
calculations of those member-stockholders during the transition period, provided
that they remain as principal members of MasterCard International and do not
sell all or substantially all of their MasterCard card portfolios. Financial
institutions that become principal members of MasterCard International after the
period of the global proxy calculation used in connection with the initial
allocation of shares will be eligible to be allocated shares at the end of the
transition period in accordance with procedures to be determined by the board of
directors. Until shares are allocated, those financial institutions will not be
entitled to vote at any meetings of stockholders of MasterCard Incorporated.

     The reallocation of shares of MasterCard Incorporated at the conclusion of
the three year transition period will be determined according to a multi-step
process. First, the number of class B convertible shares that constitute ec
Pictogram shares will be determined in accordance with the process described
below. Second, the class B convertible shares (other than ec Pictogram shares)
will be converted into class A redeemable shares on a one-for-one basis. Third,
all class A redeemable shares will be reapportioned between Europe and
non-Europe using the procedures described below. Fourth, each member-stockholder
will be allocated class A redeemable shares according to the new global proxy,
again calculated on both a European and non-European basis, as described in more
detail below.

     As a result of this reallocation (and the subsequent reallocation involving
ec Pictogram shares), member-stockholders may ultimately receive more or fewer
shares than initially allocated to them, depending on the relative performance
of the Europe region and their individual global proxy calculations at the time.
If a member's revenue contribution, GDV and/or GAV during the period prior to
reallocation grows more slowly than the membership as a whole, if any of these
amounts decline for a member relative to other members, or if a member with ec
Pictogram volumes fails to convert these to Maestro as required, the member may
be entitled to fewer shares upon reallocation than at the closing of the
conversion and integration. Members receiving additional shares upon
reallocation will do so pursuant to rights initially granted with all shares of
class A redeemable and class B convertible common stock of MasterCard
Incorporated.

     ec Pictogram Shares.  ec Pictogram shares are class B convertible shares
that do not convert to class A redeemable shares at the conclusion of the
transition period. Instead, ec Pictogram shares will convert to class A
redeemable shares on the second anniversary of the end of the transition period.
This additional two-

                                        64
<PAGE>

year holding period is designed to recognize that additional time may be needed
before the transaction volumes associated with ec Pictogram, a regional debit
program owned by Europay, can be converted to Maestro volumes. All class B
convertible shares representing ec Pictogram shares become non-voting at the end
of the transition period when the other class B convertible shares convert to
class A redeemable shares.

     The number of ec Pictogram shares will be calculated at the end of the
transition period according to the following procedures:

     - The aggregate global proxy calculation of Europe during the third year of
       the transition period will be determined.

     - Then, a simulated global proxy will be calculated assuming that certain
       ec Pictogram transactions are converted to Maestro transactions as of the
       beginning of the third year of the transition period. Because Maestro
       transactions are accorded a higher GDV and GAV weighting than ec
       Pictogram transactions, the simulated result is likely to be higher than
       the actual European aggregate global proxy calculation. ec Pictogram
       transactions will be accorded a higher weighting in the simulated proxy
       if they are associated with binding contracts to convert to Maestro
       within a two-year period following the end of the transition period.

     - The difference between the actual global proxy and the simulated global
       proxy results described above, measured in terms of a percentage of the
       outstanding class A redeemable common stock and class B convertible
       common stock of MasterCard Incorporated, will determine the number of
       shares of class B convertible common stock that constitutes the ec
       Pictogram shares. If the simulated global proxy is equal to or less than
       the actual global proxy (as measured), there will be no ec Pictogram
       shares.

     - Notwithstanding the preceding paragraph, ec Pictogram shares cannot
       exceed 5 1/3% of the total shares of MasterCard Incorporated then
       outstanding. In addition, ec Pictogram shares will be reduced by a
       percentage equal to the percentage of any over-apportionment of shares to
       Europe in connection with the thresholds described below under the
       heading "-- Reapportionment of class A redeemable Shares Between Europe
       and Non-Europe."

     Reapportionment of Class A Redeemable Shares Between Europe and
Non-Europe.  At the end of the three-year transition period, MasterCard
Incorporated will determine the global proxy calculation of all
member-stockholders (calculated on a single worldwide basis) for the last 12
months of the transition period. The European member-stockholders will be
entitled to more or fewer class A redeemable shares depending upon their
aggregate global proxy calculation, and the non-European member-stockholders
will be entitled to the remaining class A redeemable shares. The purpose of the
reapportionment is to permit the final allocation of shares of MasterCard
Incorporated to be based on the relative aggregate global proxy calculations of
the European and non-European areas during the last year of the transition
period. Specifically:

     - Europe Less than or Equal to 26%.  If the global proxy calculation
       indicates that European member-stockholders in the aggregate represent
       26% or less of the worldwide global proxy calculation for the last year
       of the transition period, then the European member-stockholders will be
       entitled to an allocation of shares of class A redeemable common stock
       that represents 26% of the number of shares of outstanding class A
       redeemable common stock and class B convertible common stock.

     - Europe Greater than 26% but Less than or Equal to 28%.  If the global
       proxy calculation indicates that European member-stockholders in the
       aggregate represent greater than 26% but less than or equal to 28% of the
       worldwide global proxy calculation for the last year of the transition
       period, then the European member-stockholders will be entitled to an
       allocation of shares of class A redeemable common stock that represents
       28% of the number of shares of outstanding class A redeemable common
       stock and class B convertible common stock.

     - Europe Greater than 28%.  If the global proxy calculation indicates that
       European member-stockholders in the aggregate represent greater than 28%
       of the worldwide global proxy calculation for the last year of the
       transition period, then the European member-stockholders will be entitled
       to an allocation of shares of class A redeemable common stock that is
       equal in percentage terms to their

                                        65
<PAGE>

       aggregate global proxy calculation for the last year of the transition
       period, up to a maximum amount, when taken together with any ec Pictogram
       shares, of 44% of the number of shares of outstanding class A redeemable
       common stock and class B convertible common stock.

Because of the conversion of the class B convertible common stock at the end of
the transition period, the only class B convertible common stock outstanding at
the time of this calculation will be the ec Pictogram shares, if any. In the
reapportionment, stockholders of MasterCard Incorporated whose initial share
allocations decrease will return shares initially allocated to them to
MasterCard Incorporated, which will deliver shares to stockholders whose initial
share allocations increase.

     Each Member-Stockholder's Global Proxy Calculation.  As in the case of the
allocation of shares at the closing, the apportionment of class A redeemable
shares between Europe and non-Europe described above will produce two pools of
class A redeemable shares, one for European member-stockholders and the other
for non-European member-stockholders. The allocation of class A redeemable
shares within each pool will be determined according to the new global proxy
calculated on a regional basis for the last year of the transition period, as
described above under the heading "-- The Initial Allocation of
Shares -- Initial Reallocation of Shares Pursuant to the Global Proxy
Calculation."

CONVERSION AND REALLOCATION OF EC PICTOGRAM SHARES

     At the end of the additional two-year holding period, all ec Pictogram
shares will be converted to class A redeemable shares, and the class A
redeemable shares will then be subject to reallocation. European member-
stockholders with ec Pictogram volumes that have converted to Maestro volumes
will be entitled to some or all of those class A redeemable shares depending
upon the percentage of ec Pictogram volumes that have actually been converted to
Maestro by that time. Non-European member-stockholders will be entitled to the
balance, which will be distributed to those member-stockholders in accordance
with the new global proxy formula based on the 12 month period ending at the end
of the additional two-year holding period. Any reallocation of class A
redeemable shares resulting from the conversion of ec Pictogram shares will be
effected by a return of shares to MasterCard Incorporated and delivery of shares
by MasterCard Incorporated. Members receiving additional shares upon
reallocation will do so pursuant to rights initially granted with all shares of
class A redeemable and class B convertible common stock of MasterCard
Incorporated.

GLOBAL PROXY CALCULATION FOLLOWING THE TRANSITION PERIOD AND CONVERSION OF THE
EC PICTOGRAM SHARES

     Following the transition period and the conversion of the ec Pictogram
shares to class A redeemable voting shares, the global proxy calculation will be
performed on an individual member-stockholder basis according to the procedures
described above under the heading "-- The Global Proxy." The European and
non-European areas will cease to have any significance in connection with the
determination of the global proxy. After the transition period,
member-stockholders will be required to maintain an ownership percentage of
MasterCard's outstanding common stock of not less than 75% nor more than 125% of
that member-stockholder's most recent global proxy calculation. Stockholders may
be required to purchase or sell shares of MasterCard Incorporated in order to
satisfy these requirements within 12 months of receipt of notice from MasterCard
Incorporated that such purchase or sale is required. Any sales of shares would
ordinarily constitute taxable transactions. Stockholders who need to sell shares
in order to satisfy the 125% requirement are obligated under the bylaws of
MasterCard Incorporated to accept the highest price offered to them for the
shares that are required to be sold.

     To the extent that member-stockholders are required to purchase shares in
order to satisfy the 75% minimum ownership requirement, shares will be available
either directly from MasterCard Incorporated or from other member-stockholders
that either are required to sell shares in order to satisfy the 125% maximum
ownership requirement or otherwise desire to sell shares. The board of directors
of MasterCard Incorporated is authorized to establish procedures by which shares
of MasterCard Incorporated common stock will be traded among member-stockholders
or purchased or sold by MasterCard. Methods for the purchase and disposition of
shares may include some or all of the following: an on-line bulletin board that
matches buyers and sellers of shares; a periodic auction conducted on behalf of
MasterCard Incorporated for buyers and sellers of shares; and directly
negotiated purchases and sales of shares. The price at which shares may be
purchased or sold will
                                        66
<PAGE>

be determined through these methods. MasterCard Incorporated will not charge
member-stockholders any commissions for facilitating trading in its shares.

     MasterCard Incorporated will purchase or sell its common stock subject to
its having sufficient capital available to effect each purchase transaction, and
only if each purchase or sale transaction is permitted under the laws, rules and
regulations applicable to MasterCard Incorporated at the time (including
securities laws). In particular, to the extent any offer by MasterCard
Incorporated to purchase its shares constitutes a tender offer under the
Exchange Act, MasterCard Incorporated will comply with the applicable tender
offer rules and regulations. In addition, MasterCard Incorporated will undertake
activities to facilitate trading of its common stock among member-stockholders
only to the extent such activities are permitted under the federal and state
securities laws of the United States and related rules and regulations. Any
shares subsequently sold by MasterCard Incorporated may not be registered under
the Securities Act of 1933, as amended, and accordingly may be subject to resale
restrictions under the Securities Act.

                                        67
<PAGE>

                                   MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

     The directors and executive officers of MasterCard Incorporated after the
conversion and integration will be the same as the directors and executive
officers of MasterCard International before the conversion and integration,
except for the addition of two voting directors affiliated with European members
and the addition of Dr. Peter Hoch, currently Chief Executive Officer of
Europay, who will be President of MasterCard's Europe region and a non-voting
director. The certificate of incorporation of MasterCard International requires
MasterCard Incorporated, as the sole class B member, to elect the directors of
MasterCard Incorporated to serve as the directors of MasterCard International.
MasterCard Incorporated will have a board comprised of 18 voting directors. One
member-stockholder of MasterCard Incorporated holding more than 5% of MasterCard
Incorporated common stock is entitled to cancel its customized member agreement
with MasterCard International if one of its employees does not have a board
seat.

     If the conversion is approved, the current directors of MasterCard
International will serve as the directors of MasterCard Incorporated and
MasterCard International until the annual meeting of MasterCard Incorporated
shareholders in 2003. In addition, the boards of directors of each company,
acting pursuant to authority granted to them in their respective certificates of
incorporation and/or bylaws, will appoint two additional voting directors
affiliated with European members and Dr. Peter Hoch as a non-voting director, in
each case to serve until the annual meeting of MasterCard Incorporated
shareholders in 2003. The board of directors of MasterCard Incorporated will be
subject to reelection in 2003. If the conversion does not occur, the current
directors of MasterCard International will continue in that capacity until an
annual meeting of MasterCard International principal members is held in 2003.

     A number of the largest members of MasterCard International that generate
significant business for MasterCard have representatives on the MasterCard
Incorporated board of directors. If any of these members were to lose its
representation on the board, this could have a detrimental effect on our
business relationship with that member.

     The bylaws of MasterCard Incorporated require that directors be officers of
a member institution of MasterCard International or an individual otherwise
uniquely qualified to provide guidance on MasterCard's affairs. For a
description of the requirements for the regional allocation of board seats
arising from the conversion and integration, see "The Conversion -- Effects of
the Conversion." In accordance with the restrictions described in that section,
the nominating committee of the MasterCard Incorporated board is charged with
nominating individuals to serve as directors, subject to election by the
stockholders. Presently, MasterCard Incorporated does not grant automatic board
seats to members that generate specified levels of revenues or transaction
volumes for MasterCard.

     Under the nominating committee's current procedures, the committee accepts
nominations from regional boards as well as individual member-stockholders, and
also considers nominees of its own volition. In selecting nominees, the
committee typically considers the following factors, among others:

     - the experience and qualifications of the individual nominee;

     - the region with which the nominee is associated;

     - whether the nominee represents an issuing or acquiring institution;

     - the size of the financial institution of which the nominee is an officer,
       the extent of such institution's business with MasterCard (in terms of
       revenues, issuing volumes and/or acquiring volumes), and the degree of
       such institution's relative dedication to the MasterCard brand; and

     - whether the financial institution of which the nominee is an officer is
       of particular strategic importance to MasterCard.

     Because the size of member-stockholders and their dedication to MasterCard
are important factors considered by the nominating committee, it is possible
that a director associated with a member-stockholder whose business with
MasterCard declines relative to others may not be proposed for reelection by the

                                       125
<PAGE>

nominating committee. Similarly, officers of member-stockholders that make large
and growing contributions to MasterCard's revenues and volumes are more likely
to be considered by the nominating committee for nomination to the board of
directors.

     The following table sets forth certain information regarding the executive
officers and directors of MasterCard Incorporated and MasterCard International
after the conversion and integration.

<Table>
<Caption>
NAME                                   AGE                           POSITION
----                                   ---                           --------
<S>                                    <C>   <C>
Lance L. Weaver......................  47    Chairman of the Board and Director
Baldomero Falcones Jaquotot..........  55    Vice Chairman and Director
Donald L. Boudreau...................  60    Chairman Emeritus and non-voting Director
Robert W. Selander...................  51    President, Chief Executive Officer and Director
William F. Aldinger..................  54    Director
Hiroshi Arai.........................  72    Director
David A. Coulter.....................  54    Director
William R.P. Dalton..................  58    Director
Augusto M. Escalante Juanes..........  52    Director
Jan A.M. Hendrikx....................  56    Director
Jean-Pierre Ledru....................  63    Director
Norman C. McLuskie...................  57    Director
John Francis Mulcahy.................  51    Director
Robert W. Pearce.....................  47    Director
Robert B. Willumstad.................  56    Director
Mark H. Wright.......................  56    Director
Ronald N. Zebeck.....................  47    Director
Denise K. Fletcher...................  53    Executive Vice President and Chief Financial Officer
Noah J. Hanft........................  49    General Counsel and Secretary
Alan J. Heuer........................  60    Senior Executive Vice President, Customer Group
Peter Hoch...........................  61    President, MasterCard Europe region and non-voting
                                             Director
Jerry McElhatton.....................  63    Senior Executive Vice President, Global Technology &
                                             Operations
Michael W. Michl.....................  56    Executive Vice President, Central Resources
Christopher D. Thom..................  53    Senior Executive Vice President, Global Development
                                             Group
Spencer Schwartz.....................  35    Senior Vice President and Controller
</Table>

BOARD OF DIRECTORS

     Biographies of the directors of MasterCard Incorporated after the
conversion and integration are set forth below. All of the following persons are
currently directors or non-voting advisory directors of MasterCard
International. With the exception of Mr. Selander, the President and Chief
Executive Officer of MasterCard Incorporated, Mr. Boudreau, the Chairman
Emeritus, and Mr. Hoch, the Chief Executive Officer of Europay, all MasterCard
Incorporated directors are presently employees of members of MasterCard
International.


     Lance L. Weaver is an Executive Vice Chairman of MBNA America Bank, N.A.
and Chairman of the board of MasterCard Incorporated. Mr. Weaver was first
elected to the MasterCard International board of directors in 1997 and was
elected chairman of the board of MasterCard International in 2001. Before
joining MBNA America Bank in 1991, Mr. Weaver held various management positions
with Wells Fargo and Citicorp/Citibank. He is director of MBNA America Bank and
MBNA Information Services. He also serves on the board of directors of the
Christiana Care Corporation and the Wilmington Renaissance Corporation. He is a
member of the Georgetown University Board of Directors and the Tower Hill School
Board of Trustees.


                                       126
<PAGE>


     Baldomero Falcones Jaquotot is Vice Chairman of the board of MasterCard
International. He has been a member of the MasterCard International board of
directors since 1997. Mr. Falcones joined Banco Hispano Industrial, a
predecessor of Banco Santander Central Hispano, in 1984 and has served as Senior
Executive Vice President and a member of the Executive Committee of Banco
Santander Central Hispano for fifteen years. Mr. Falcones also serves as
Chairman of Aquanima Holding, S.A. and Aquanima Iberica, S.A. and as a director
and a member of the Executive Committee of Europay International S.A. He is a
director of Union Fenosa, S.A., S.C.H. Seguros y Reaseguros, S.A., Sistema 4B,
S.A., and B2BF, S.A.



     Donald L. Boudreau is Chairman Emeritus and a non-voting advisory director
of MasterCard Incorporated. Mr. Boudreau has served on the MasterCard
International board of directors since 1997 and was the Chairman of the
MasterCard International board of directors from April 1998 to March 2001. Mr.
Boudreau recently retired as a Vice Chairman of The Chase Manhattan Corporation
and The Chase Manhattan Bank, where he was a member of the Executive Committee.
Mr. Boudreau served in a variety of positions during his 40 year career at
Chase, and most recently was responsible for all of Chase's small and consumer
and middle market businesses. Mr. Boudreau is a member of the board of directors
of the New York City Blood Center, and a member of the board of trustees of the
New York Presbyterian Hospital, Pace University and the United Way of Tri-State.


     Robert W. Selander will be President and Chief Executive Officer of
MasterCard Incorporated and presently holds the same position at MasterCard
International. Mr. Selander has served on the MasterCard International board of
directors since 1997. Prior to his election as President and Chief Executive
Officer of MasterCard International, Mr. Selander was an Executive Vice
President and President of the MasterCard International Europe, Middle
East/Africa and Canada regions. He also currently serves as a director of
Hartford Financial Services Group and Europay International. Before joining
MasterCard in 1994, Mr. Selander spent two decades with Citicorp/Citibank, N.A.

     William F. Aldinger is the Chairman and Chief Executive Officer of
Household International. Mr. Aldinger was first elected to the MasterCard
International board of directors in 1998 and is a former member of MasterCard
International's U.S. region board of directors. Mr. Aldinger joined Household
International in 1994, and prior to that time served in various positions at
Wells Fargo Bank, including Vice Chairman. Mr. Aldinger is a member of the
boards of directors of Illinois Tool Works, Inc. and Evanston Northwestern
Healthcare. He is a member of the combined boards of directors of Children's
Memorial Medical Center/Children's Memorial Hospital and the Children's Memorial
Foundation located in Chicago. Mr. Aldinger is also a member of the board of
trustees of Northwestern University and the J.L. Kellogg Graduate School of
Management.

     Hiroshi Arai is the Chairman of the Board of Orient Corporation, a position
he has held since 1999. Mr. Arai has been a member of the MasterCard
International board of directors since 1999 and is currently a member of
MasterCard International's Asia/Pacific region board of directors. Prior to
joining Orient Corporation in 1993, Mr. Arai was employed for forty years with
Dai-ichi Kangyo Bank, where he held various positions including Deputy
President.


     David A. Coulter is Vice Chairman of J.P. Morgan Chase & Co. and head of
its retail and middle market business, as well as its investment management and
private banking activities. Mr. Coulter has been a member of MasterCard
International's board of directors since 2001. Prior to the merger between J.P.
Morgan and The Chase Manhattan Corporation, Mr. Coulter was Vice Chairman of The
Chase Manhattan Corporation and The Chase Manhattan Bank. In 1999 and 2000, Mr.
Coulter was a partner of The Beacon Group. From 1996 to 1998, Mr. Coulter was
Chairman and Chief Executive Officer of BankAmerica Corporation. He is a
director of PG&E Corporation and Pacific Gas and Electric Company. Mr. Coulter
also serves on the boards of directors of the San Francisco Art Institute, the
Asia Society and the National Mentoring Partnership, and is a member of The
Business Council. He is also a trustee of Carnegie Mellon University and the
Public Policy Institute of California.


     William R. P. Dalton is Chief Executive of HSBC Bank plc (formerly Midland
Bank plc) and a director of HSBC Holdings plc. Mr. Dalton was first elected to
the MasterCard International board of directors in 1998. Prior to joining HSBC
Bank plc in 1998, Mr. Dalton served as President and Chief Executive Officer of
                                       127
<PAGE>


HSBC Bank Canada. Mr. Dalton joined HSBC Bank Canada in 1980. Mr. Dalton is
Deputy Chairman of Merrill Lynch HSBC Limited and is also a director of HSBC
Investment Bank Holdings plc, CCF SA and HSBC Private Banking Holdings (Suisse)
SA. He is Chairman of Young Enterprise in the United Kingdom and Vice President
of the Chartered Institute of Bankers. In addition, Mr. Dalton is a Fellow of
the Institute of Canadian Bankers and a Fellow of the Chartered Institute of
Bankers.


     Augusto M. Escalante Juanes is Deputy President, Consumer Product and
Marketing Areas, Banco Nacional de Mexico, S.A. Mr. Escalante Juanes was elected
to the MasterCard International board of directors in 2001 after having
previously served on the board from April 1998 to March 1999, and is currently
chairman of MasterCard International's Latin America and Caribbean region board
of directors. Mr. Escalante Juanes joined Banco Nacional de Mexico in 1991. At
Banco Nacional de Mexico, Mr. Escalante Juanes is responsible for all consumer
products, both deposit and credit, and all marketing and advertising for the
Financial Group of Banco Nacional de Mexico. He was previously Deputy President,
Bank Card and Electronic Services Area, and Deputy President, Consumer Loans
Area of Banco Nacional de Mexico.


     Jan A.M. Hendrikx is Chief Executive Officer of EURO Kartensysteme. Mr.
Hendrikx was first elected to the MasterCard International board of directors in
2001. Mr. Hendrikx joined EURO Kartensysteme in 1997 as chief executive officer
and prior to that time served in senior positions in the European offices of
Visa International and Citibank. He has served on the Europay International
board of directors since 1998.


     Jean-Pierre Ledru is Senior Executive Vice President of Credit Agricole SA.
He has served on the MasterCard International board of directors since 1991. In
addition, Mr. Ledru is Chairman of Cedicam, Chairman and C.E.O. of Europay
France, Chairman of Europay International, and Vice Chairman of the Groupement
des Cartes Bancaires. In addition, Mr. Ledru is Executive Vice Chairman of BMS
(Billetique Monetique Services) and a member of the board of directors of AROP
(Association pour le Rayonnement de l'Opera National de Paris).


     Norman C. McLuskie is a Director of the Royal Bank of Scotland Group plc,
the Royal Bank of Scotland plc and National Westminister Bank plc. Mr. McLuskie
was first elected to the MasterCard International board of directors in 2000.
Mr. McLuskie joined Royal Bank of Scotland in 1982. Following the acquisition of
Natwest by the Royal Bank of Scotland in March 2000, he was appointed Chief
Executive of Retail Direct, a division of the Royal Bank of Scotland Group
encompassing its card and consumer finance businesses, among others. Mr.
McLuskie's other directorships include: Chairman of Royscot Financial Services
Ltd, Chairman of RBS Cards Ltd, Chairman of Virgin Direct Personal Finance Ltd
and Deputy Chairman of Tesco Personal Finance. Mr. McLuskie is also Vice
Chairman of Europay International and a fellow of the Chartered Institute of
Bankers in Scotland.


     John Francis Mulcahy is Head of Australian Financial Services Division,
Commonwealth Bank of Australia. He has served on the MasterCard International
board of directors since 1998 and is currently a member of MasterCard
International's Asia/Pacific region board of directors. Prior to joining the
Commonwealth Bank of Australia in 1995, Mr. Mulcahy was Chief Executive Officer
of Lend Lease Property Investment Services. He currently serves as a director of
IPAC Securities Limited, EDS Australia Pty. Limited and TCNZ Australia Pty
Limited.

     Robert W. Pearce is President of Distribution in the Personal & Commercial
Client Group for Bank of Montreal, where he has worked for over twenty years. He
has served on the MasterCard International board of directors since 1999. He
previously served as Executive Vice-President of North American Electronic
Banking Services for Bank of Montreal and was responsible for Bank of Montreal's
MasterCard Cardholder and Merchant Services lines of business, Debit Card
business, and Electronic Banking.


     Robert B. Willumstad is President of Citigroup and Chairman and Chief
Executive Officer of Citigroup's Consumer Group, overseeing its North American
cards businesses, Citibanking North America, Europe and Japan, CitiFinancial,
Citigroup's Mortgage Banking business and Primerica, and has product
responsibility for Global Cards and Consumer Finance. Mr. Willumstad is also
responsible for, among other things, Citigroup's e-consumer unit, which provides
Internet payment solutions and financial services offerings across all of


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<PAGE>

Citigroup's consumer businesses. Mr. Willumstad has served on the MasterCard
International board of directors since 1999. Mr. Willumstad was Chairman and CEO
of Travelers Group Consumer Finance Services prior to the merger between
Citicorp and Travelers Group in 1998. Mr. Willumstad joined Commercial Credit,
now CitiFinancial, in 1987. Prior to joining Citigroup's predecessor companies,
Mr. Willumstad served in various positions with Chemical Bank for twenty years,
last holding the position of President of Chemical Technologies Corporation.


     Mark H. Wright is President and Chief Executive Officer of USAA Federal
Savings Bank, and serves as Vice Chairman of USAA Federal Savings Bank's board
of directors. He also serves as Chairman of the Board of USAA Savings Bank. Mr.
Wright joined USAA in 1993. Mr. Wright has been a member of the MasterCard
International board of directors since 1996, is chairman of the audit committee
of MasterCard International's board, and is currently a member of MasterCard
International's U.S. region board of directors. He is on the board of the Alamo
Bowl in San Antonio. Mr. Wright also serves as a trustee on the board of Our
Lady of the Lake University in San Antonio. Mr. Wright is a member and President
of the Thrift Institutions Advisory Council appointed by the Federal Reserve
Bank.


     Ronald N. Zebeck is Chairman and Chief Executive Officer of Metris
Companies Inc., as well as Chief Executive Officer of Direct Merchants Credit
Card Bank. Mr. Zebeck has served on the MasterCard International board of
directors since 1997 and is currently a member of MasterCard International's
U.S. Region board of directors. Prior to joining Metris Companies Inc. in 1994,
Mr. Zebeck held various credit card related positions at Citicorp, Advanta and
General Motors.

EXECUTIVE OFFICERS

     Biographies of the executive officers of MasterCard Incorporated and
MasterCard International after the conversion and integration other than Mr.
Selander are set forth below. Each of the following officers currently hold the
same position with MasterCard International before the conversion and
integration that they will hold in MasterCard Incorporated and MasterCard
International after the conversion and integration, except for Dr. Peter Hoch,
who is currently the Chief Executive Officer of Europay International.

     Denise K. Fletcher will be Executive Vice President and Chief Financial
Officer of MasterCard Incorporated and a member of MasterCard's Executive
Management Group. Ms. Fletcher will be responsible for the corporate finance,
planning, audit, purchasing and new markets and investments functions at
MasterCard. Prior to joining MasterCard in 2000, Ms. Fletcher spent four years
as Senior Vice President and Chief Financial Officer of Bowne & Company, the
world's largest financial printer, with responsibility for finance and strategy.
She serves on the boards of directors of Girl Scouts USA and the YWCA of the
City of New York.

     Noah J. Hanft will be General Counsel and Secretary of MasterCard
Incorporated and a member of MasterCard's Executive Management Group. Mr. Hanft
has served in various increasingly senior legal positions at MasterCard since
1984, except for 1990 to 1993, when Mr. Hanft was Senior Vice President and
Assistant General Counsel at AT&T Universal Card Services. Prior to joining
MasterCard, Mr. Hanft was associated with the intellectual property law firm of
Ladas & Parry in New York.

     Alan J. Heuer will be Senior Executive Vice President of MasterCard
Incorporated and a member of MasterCard's Executive Management Group. Mr. Heuer
will be responsible for MasterCard's Customer Group, which encompasses all
member relations, global marketing and consulting/cardholder services functions,
as well as MasterCard's regional activities. Mr. Heuer joined MasterCard in
1995. Prior to that time, Mr. Heuer served as Executive Vice President, Retail
Banking, for the Bank of New York.


     Dr. Peter Hoch will be President of MasterCard's Europe region and a member
of MasterCard's Executive Management Group. Dr. Hoch will also be a non-voting,
advisory director of MasterCard Incorporated. Dr. Hoch was a Vice Chairman of
Europay International from 1992 until 2000, and became Europay's Chief Executive
Officer in November 2000. From 1984 to 1999, Dr. Hoch was a member of the board
of management of Hypo-Bank AG, responsible for information technology and
payment systems, and a part of the branch network. He was responsible for
managing the merger between Hypo-Bank and Bayerische


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<PAGE>

Vereinsbank to form Hypo Vereinsbank, and served on the management board of Hypo
Vereinsbank in 1998 and 1999. Dr. Hoch is currently a member of the board of
directors of Giesecke & Devrient.

     Jerry McElhatton will be Senior Executive Vice President of MasterCard
Incorporated and a member of MasterCard's Executive Management Group. Mr.
McElhatton will be responsible for MasterCard's Global Technology and Operations
group, which includes the St. Louis transaction processing facility. Before
joining MasterCard in 1994, Mr. McElhatton was President and Chief Executive
Officer of Dallas-based Payment Systems Technology & Consulting, Inc. Mr.
McElhatton currently serves on the board of directors of Ignite Sales, Inc. and
Mascon, a development firm based in India; the board of directors of St. Louis
University; the board of directors of the Regional Commerce and Growth
Association in St. Louis; the National Council for the Olin School of Business
of Washington University in St. Louis; and the boards of directors of Rainbow
Village in St. Louis and the United Way (St. Louis).

     Michael W. Michl will be Executive Vice President of MasterCard
Incorporated and will be a member of MasterCard's Executive Management Group.
Mr. Michl will be responsible for MasterCard's Central Resources unit,
encompassing the communications, global human resources and corporate services
functions. Mr. Michl joined MasterCard in 1998 from Avon Products, where he was
Vice President of Human Resources.

     Christopher D. Thom will be Senior Executive Vice President of MasterCard
Incorporated and a member of MasterCard's Executive Management Group. Mr. Thom
will be responsible for MasterCard's Global Development Group, which manages the
brand and program development functions at MasterCard, as well as MasterCard's
initiatives in the areas of electronic commerce, mobile commerce and chip-based
smart cards. Prior to joining MasterCard in 1995, Mr. Thom served in a variety
of positions at HSBC Group in the United Kingdom, including as general manager,
Strategic Development and general manager, Retail. In the latter position, Mr.
Thom was responsible for the core banking services and products delivered
through HSBC's branch network, as well as HSBC's card service, private banking
and other businesses. Mr. Thom is a director of MXI.

     Spencer Schwartz will be Senior Vice President and Controller for
MasterCard Incorporated. Mr. Schwartz will be primarily responsible for all
accounting and financial control functions at MasterCard. Prior to assuming the
Controller position for MasterCard International in 2000, Mr. Schwartz was the
Vice President of Taxation for MasterCard International. Before joining
MasterCard in 1996, Mr. Schwartz headed the tax department for Carl Zeiss, Inc.,
operated his own accounting and tax firm and held various positions with Price
Waterhouse.

COMMITTEES OF THE BOARD

     The board of MasterCard Incorporated is authorized to designate from among
its members an executive committee, which will have all the authority of the
board of directors, and other committees. The Chairman of the board will be an
ex officio member of all committees. The board of MasterCard Incorporated will
have the same committees with the same functions and members as MasterCard
International had before the conversion. In addition, the board of MasterCard
Incorporated may appoint additional regular committees of the board of
MasterCard Incorporated. The committees of the board are described below.

     EXECUTIVE.  The executive committee may exercise the authority of the board
of directors when the board is not in session, as permitted by law and the
bylaws of MasterCard Incorporated. At present, the board of MasterCard
Incorporated does not expect to appoint an executive committee.

     AUDIT.  The audit committee will assist the board of directors in
fulfilling its oversight responsibilities. Among other things, it will review
the activities, results and effectiveness of internal and external auditors,
confirm the independence of the external auditors and recommend to the board of
directors the appointment of the external auditors. The audit committee will
also review MasterCard Incorporated's key risks and controls and its quarterly
and annual financial statements. The members of the audit committee are expected
to be Messrs. Weaver, Wright, Boudreau, McLuskie, Pearce and Zebeck.

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<PAGE>

     COMPENSATION.  The compensation committee will establish the compensation
policies and criteria of the Chief Executive Officer and other executive
officers of MasterCard Incorporated. The members of the compensation committee
are expected to be Messrs. Weaver, Aldinger, Boudreau and Falcones.

     NOMINATING.  The nominating committee will consider and nominate
individuals to serve as directors of MasterCard Incorporated for approval by the
class A and class B stockholders at the annual meeting of stockholders, based
upon proposals made by each regional board of MasterCard Incorporated. The
members of the nominating committee are expected to be Messrs. Weaver, Aldinger,
Boudreau, Dalton, Falcones, Ledru and Willumstad.

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION

     The following table shows the before-tax compensation for the Chief
Executive Officer and the four next highest paid executive officers of
MasterCard International at the end of 2001, which we collectively refer to as
the named executive officers.

<Table>
<Caption>
                                                                                 LONG-TERM
                                           ANNUAL COMPENSATION                  COMPENSATION
                             -----------------------------------------------    ------------
                                                              OTHER ANNUAL          LTIP           ALL OTHER
NAME AND PRINCIPAL POSITION  YEAR   SALARY      BONUS(1)     COMPENSATION(2)      PAYOUTS       COMPENSATION(3)
---------------------------  ----  --------    ----------    ---------------    ------------    ---------------
<S>                          <C>   <C>         <C>           <C>                <C>             <C>
Robert W. Selander.......    2001  $783,333    $2,500,000       $205,499         $3,479,000        $451,447
  President & CEO            2000  $700,000    $2,000,000       $198,760                 --        $419,360
Alan J. Heuer............    2001  $575,000    $  900,000       $153,971         $2,380,000        $201,341
  Senior Executive VP        2000  $575,000    $  800,000       $137,796                 --        $174,317
Jerry McElhatton.........    2001  $575,000    $  825,000       $149,047         $2,047,500        $395,586
  Senior Executive VP        2000  $575,000    $  725,000       $133,849                 --        $375,758
Christopher D. Thom......    2001  $500,000    $  700,000       $113,747         $2,072,000        $196,316
  Senior Executive VP        2000  $500,000    $  700,000       $116,470                 --        $129,283
Denise K. Fletcher(4)....    2001  $375,000    $  450,000       $ 42,182                 --        $ 44,485
  Executive VP               2000  $120,913    $  200,000             --                 --        $210,000(5)
</Table>

---------------
(1) Additional bonuses for services performed in 2001 will be paid to Mr.
    Selander ($250,000 at the closing of the conversion and integration and
    $250,000 per year for each of the following three years), Mr. Thom ($200,000
    at the closing and $66,667 per year for each of the following three years)
    and Ms. Fletcher ($200,000 at the closing and $66,667 per year for each of
    the following three years), if, and only if, the conversion and integration
    is consummated.

(2) Amounts principally represent reimbursement for tax obligations in
    connection with non-qualified retirement benefits.

(3) For 2001, includes matching contributions under the MasterCard
    International's 401(k) plan (Mr. Selander -- $22,134; Mr. Heuer -- $22,134;
    Mr. McElhatton -- $22,190; Mr. Thom -- $22,190; Ms. Fletcher -- $7,378);
    MasterCard International's contributions to both a non-qualified defined
    benefit and defined contribution plan -- Annuity Bonus Plan (Mr.
    Selander -- $186,513; Mr. Heuer -- $131,087; Mr. McElhatton -- $124,871; Mr.
    Thom -- $80,314; Ms. Fletcher -- $2,107); the dollar value of the benefit of
    premiums paid for a split-dollar life insurance policy projected on an
    actuarial basis (Mr. Thom -- $47,579); the full amount of all premiums paid
    by MasterCard International for executive life insurance coverage (Mr.
    Selander -- $36,800; Mr. Heuer -- $3,120; Mr. McElhatton -- $3,524; Mr.
    Thom -- $1,232); MasterCard International's contributions to a deferred
    compensation plan -- Rabbi Trust (Mr. Selander -- $150,000; Mr.
    McElhatton -- $200,000); cash payments in lieu of executive perquisites (Mr.
    Selander -- $56,000; Mr. Heuer -- $45,000; Mr. McElhatton -- $45,000; Mr.
    Thom -- $45,000; Ms. Fletcher -- $35,000).

(4) Ms. Fletcher joined MasterCard International in September 2000. Her salary
    and bonus amounts for fiscal 2000 reflect a partial year.

(5) Represents a one-time bonus paid upon hiring.

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<PAGE>

LONG-TERM INCENTIVE PLAN-AWARDS IN FISCAL YEAR 2001

     The following table lists grants of performance units in 2001 to the named
executive officers:

<Table>
<Caption>
                       NUMBER OF
                         UNITS       PERFORMANCE OR OTHER
NAME                   AWARDED(1)   PERIOD UNTIL MATURATION   THRESHOLD ($)   TARGET ($)   MAXIMUM ($)
----                   ----------   -----------------------   -------------   ----------   -----------
<S>                    <C>          <C>                       <C>             <C>          <C>
Robert W. Selander...    35,225     1/1/2001 -- 12/31/2003      1,761,250      3,522,500    7,045,000
  President and CEO      19,050(2)  1/1/2001 -- 12/31/2003        952,500      1,905,000    3,810,000
Alan J. Heuer........    20,250     1/1/2001 -- 12/31/2003      1,012,500      2,025,000    4,050,000
  Senior Executive VP    11,500(2)  1/1/2001 -- 12/31/2003        575,000      1,150,000    2,300,000
Jerry McElhatton.....    15,525     1/1/2001 -- 12/31/2003        776,250      1,552,500    3,105,000
  Senior Executive VP     8,625(2)  1/1/2001 -- 12/31/2003        431,250        862,500    1,725,000
Christopher D.           17,625
  Thom...............               1/1/2001 -- 12/31/2003        881,250      1,762,500    3,525,000
  Senior Executive VP
Denise K. Fletcher...     8,800     1/1/2001 -- 12/31/2003        440,000        880,000    1,760,000
  Executive VP            1,450(2)  1/1/2001 -- 12/31/2003         72,500        145,000      290,000
</Table>

---------------
(1) The performance units were granted under MasterCard International's
    Executive Incentive Plan. Each performance unit has a target value equal to
    $100. The actual value of each unit will be calculated based on MasterCard
    International's performance over a three-year period based on a combination
    of qualitative and quantitative measures that include: improving profitable
    share with key members in key markets; improving customer focused strategy;
    achieving corporate financial targets and enhancing organizational
    capabilities. Each unit will be valued at target ($100) if, on a
    weighted-average basis, target performance is achieved for all of the
    performance measures. Each unit will be valued at threshold ($50) if, on a
    weighted-average basis, threshold performance is achieved. Each unit will be
    valued at maximum ($200) if, on a weighted-average basis, maximum
    performance is achieved. For performance between threshold and target or
    target and maximum, the value of the units will be increased on a straight
    line basis. The units will have no value if performance is below threshold.

(2) Represents one-time special grants awarded pursuant to the Executive
    Incentive Plan that vests 100% after five years for Mr. Selander; three
    years for Mr. Heuer, Mr. McElhatton and Ms. Fletcher.

     The performance units described in the preceding table are subject to
vesting as described below. Performance units that relate to a three-year
performance period will vest in annual increments according to the following
schedule if the participant completes 1,000 hours of service and is employed by
MasterCard International on the last day of the respective twelve-month cycle:

<Table>
<Caption>
                     TWELVE-MONTH CYCLE
                  ENDING ON THE FOLLOWING
                     ANNIVERSARY OF THE                       % OF PERFORMANCE
                       DATE OF GRANT                            UNITS VESTED
                  -----------------------                     ----------------
<S>                                                           <C>
1st Anniversary.............................................       26.67%
2nd Anniversary.............................................       26.67%
3rd Anniversary.............................................       26.67%
4th Anniversary.............................................           0%
5th Anniversary.............................................          20%
</Table>

     Unvested performance units relating to the twelve-month cycle in which a
participant terminates employment with MasterCard International, and subsequent
twelve-month cycles during the vesting period for the award, will be forfeited
upon termination of employment. If a participant is rehired during a subsequent
twelve-month cycle in the vesting period for the same award of performance
units, the participant will be eligible to vest in the performance units for the
award that relate to the twelve-month cycle of rehiring and subsequent
twelve-month cycles if the participant otherwise meets the terms and conditions
specified in the award and completes 1,000 hours of service in, and is employed
by MasterCard International on the last day of, the twelve-month cycle.

                                       132
<PAGE>

     Upon completion of the three-year performance period, participants will
receive a payout equal to 80% of the award earned. The remaining 20% of the
award will be paid upon completion of two additional years of service, (i.e., 5
years of service in total). Participants who retire (with at least six months of
service during the performance period), die or become permanently disabled prior
to the end of the three-year performance period and/or prior to the end of the
five-year performance period are eligible for 100% vesting of their units, and
receive a payout equal to the number of units granted for the period multiplied
by the target unit value of $100. If a participant is terminated for cause, all
units will be forfeited. Upon any other termination, only unvested units will be
forfeited and vested units will be paid at target.

RETIREMENT BENEFITS

MASTERCARD ACCUMULATION PLAN (MAP)

     Any employee who participates in the MAP earns benefits under the MAP as
soon as he or she becomes an employee of MasterCard. Benefits generally vest
after four years of service. For each plan year after January 1, 2000,
participants are credited with a percentage of their compensation for the plan
year in accordance with the table below:

<Table>
<Caption>
                                                              PAY CREDIT
                                                              FOR CURRENT
COMPLETED YEARS OF SERVICE AT DECEMBER 31 OF PRIOR PLAN YEAR   PLAN YEAR
------------------------------------------------------------  -----------
<S>                                                           <C>
 0 -  4.....................................................      4.50%
 5 -  9.....................................................      5.75%
10 - 14.....................................................      8.00%
15 - 19.....................................................     10.00%
20 - 29.....................................................     12.00%
</Table>

     Compensation is defined as base pay plus annual incentive compensation.
These accounts also receive investment credits. Participants elect to allocate
their account balance prior to the start of each plan year, during open
enrollment, based on the following allocation options:

<Table>
<Caption>
                                                              S&P 500
THIRTY-YEAR TREASURY ACCOUNT                                  ACCOUNT
----------------------------                                  -------
<S>                                                           <C>
100%........................................................      0%
80%.........................................................     20%
50%.........................................................     50%
20%.........................................................     80%
0%..........................................................    100%
</Table>

     The annual investment credits on the Standard & Poor's 500 Account are
restricted to a minimum of 0% and a maximum of 15%. No election can be made for
plan years beginning after December 31, 2002. When a participant terminates
employment, the amount credited to the participant's account is paid in a lump
sum or converted into an annuity.

SUPPLEMENTAL RETIREMENT BENEFITS

     Supplemental retirement benefits are provided to all named executive
officers and certain other participants under various funded and unfunded
nonqualified plans. Benefits are provided to certain employees whose benefits
are limited by compensation or amount under applicable federal tax laws and
regulations. Designated employees may also receive an annual benefit at
retirement equal to a designated percentage of their final average base
compensation reduced by the amount of all benefits received under the MAP and
other qualified and nonqualified arrangements.

                                       133
<PAGE>

ESTIMATED ANNUAL RETIREMENT BENEFITS PAYABLE TO CERTAIN EXECUTIVE OFFICERS

     The following table shows the estimated annual retirement benefits,
including supplemental retirement benefits under the plans applicable to the
individuals, which would be payable to each executive officer listed assuming
retirement at age 65 at his or her 2001 base salary with payments made for the
life of each participant.

<Table>
<Caption>
                                                          YEAR OF 65TH    ESTIMATED ANNUAL
NAME                                                        BIRTHDAY         BENEFIT(1)
----                                                      ------------    -----------------
<S>                                                       <C>             <C>
Robert W. Selander......................................      2015            $783,000
Alan J. Heuer...........................................      2006            $460,000
Jerry McElhatton........................................      2004            $460,000
Christopher D. Thom.....................................      2013            $400,000
Denise K. Fletcher......................................      2013            $ 57,000
</Table>

---------------
(1) Assumes MAP and Annuity Bonus Plan account balance increases with annual
    salary credits and interest credits projected at 6% per year.

     Included in the Estimated Annual Benefit in the table above is the MAP
Conversion Annuity, part of MasterCard's nonqualified defined benefit plan,
which was applicable to all executives with earnings exceeding the Internal
Revenue Code section 401(a)(17) limit. This annuity was designed to cover
certain early retirement subsidies applicable under the former pension plan to
all plan participants. The aggregate annuity for certain named executive
officers exceeded $100,000 (Mr. Selander -- $194,693, Mr. Heuer -- $136,696, Mr.
McElhatton -- $130,514, Mr. Thom -- $114,057).

401(k) SAVINGS PLAN

     Employees who participate in the 401(k) plan may contribute from 2% to 6%
of base pay on a tax-deferred basis. In addition, after-tax contributions are
permitted, and employees may also contribute supplemental tax-deferred and
after-tax amounts from 1% to 3%. Internal Revenue Service limits apply to all
tax-deferred contributions.

     A 217% match is provided on employee contributions up to 6% of base pay.
Employees must contribute to the 401(k) plan to receive matching contributions.
Matching contributions are 100% vested after 4 years of service under a graded
vesting schedule. Loans and certain types of withdrawals are permitted.

COMPENSATION OF DIRECTORS

     Members of the board of MasterCard Incorporated will receive the same
compensation as members of the board of MasterCard International before the
conversion as set forth below. The board of MasterCard Incorporated does not
intend to establish any compensation for members of the board of MasterCard
International.

     In fiscal year 2001, directors who were not employees of MasterCard
International were paid an annual retainer of $25,000. The chairman of the board
received an annual retainer of $30,000. Non-employee directors also received an
annual retainer of $5,000 for serving as a chairperson of a standing committee;
a $1,500 meeting fee for attendance at global and U.S. regional board meetings;
a $1,000 meeting fee for attendance at committee meetings and a $500 meeting fee
for telephonic meetings. In addition, customary expenses for attending board and
committee meetings were reimbursed.

     Under the MasterCard Deferral Plan, up to 100% of non-employee director's
meeting fees and annual retainer may be deferred and invested among several
investment return options. In general, deferred amounts are not paid until after
the director retires from the board. The amounts are then paid, at the
director's option, either in a lump sum or in ten annual installments.

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<PAGE>

EMPLOYMENT AGREEMENTS AND CHANGE-IN-CONTROL ARRANGEMENTS

EMPLOYMENT AGREEMENT

     MasterCard International is party to an employment agreement with Mr.
Selander. Under the terms of the agreement, Mr. Selander's employment shall
automatically terminate if he: (1) retires or becomes eligible to receive
retirement benefits; (2) dies or (3) becomes disabled. In addition, both he and
MasterCard can terminate the agreement for any reason upon ninety (90) days'
prior written notice. During the employment term, Mr. Selander is eligible to
participate in MasterCard's rewards plans and arrangements on a level
commensurate with his position.

     The agreement also provides that if Mr. Selander's employment is terminated
either by MasterCard other than for cause or by him for certain specified
reasons, he shall receive any earned, but unpaid base salary, a pro rata portion
of his target bonus and severance pay in the form of base salary continuation
and his average annual incentive bonus, received over the prior three years, for
a period of thirty-six (36) months. He is also subject to non-competition and
non-solicitation covenants for a minimum period of twelve (12) months, up to the
full length of the severance period.

     Pursuant to the agreement, Mr. Selander is eligible for annual company
contributions of up to $150,000 to a rabbi trust or other tax deferred
investment vehicle. $50,000 of this amount is guaranteed and the remaining
$100,000 is based upon MasterCard attaining certain threshold and target
performance goals. Generally, the vested portion of the assets is payable at the
later of age 55 or his termination of employment.

CHANGE-IN-CONTROL ARRANGEMENTS

     MasterCard International has approved a change in control agreement for
certain of its executive officers, including all of the named executive
officers. To date, Mr. Selander is the only executive officer who has executed
the change in control agreement. Under the agreement, if an executive officer's
employment is terminated without "cause" or for "good reason" (as defined in the
agreement) during the six-month period preceding or the two-year period
following a "change in control" of MasterCard International, the executive will
be entitled to the following:

     - a severance payment equal to two times the average base salary and bonus
       (three times in the case of the CEO), payable over a 24-month period (36
       months in the case of the CEO), subject to recalculation to be payable
       over the period until the executive is eligible to retire (without any
       increase in the amount payable);

     - continued coverage under the executive's individual long-term disability
       plan for the 24- or 36-month period;

     - continued coverage in the medical, dental, hospitalization and vision
       care plans for up to eighteen months;

     - accelerated vesting of performance units including special grants awarded
       prior to the change in control under the Executive Incentive Plan, with
       payout at 125% of target;

     - accelerated vesting of appreciation of share units granted under the
       value appreciation plan;

     - accelerated vesting of special grants awarded pursuant to the Executive
       Incentive Plan, nonqualified retirement and deferred compensation
       benefits;

     - lump sum payment equal to the value of unvested qualified plan benefits;

     - outplacement assistance; and

     - an excise tax gross-up for any taxes incurred as a result of Section 4999
       of the Internal Revenue Code.

     The executive would be subject to a covenant not to compete and not to
solicit employees for up to 24-months (36 in the case of the CEO).

                                       135
<PAGE>

     For purposes of the agreement, a "change in control" is defined as follows:

          (a) as long as MasterCard International is a non-stock membership
     corporation or it or any of its affiliates is a private share corporation,
     if (1) at any time three members have become entitled to cast at least 45
     percent of the votes eligible to be cast by all the members of MasterCard
     International (or all the shareholders of such private share corporation)
     on any issue, (2) at any time, a plan or agreement is approved by the
     members or shareholders, as the case may be, to sell, transfer, assign,
     lease or exchange substantially all of MasterCard International's (or such
     private share corporations') assets, or (3) at any time, a plan is approved
     by the members of MasterCard International (or the shareholders of such
     private share corporation) for the sale or liquidation of MasterCard
     International or such private share corporation. The foregoing
     notwithstanding, a reorganization in which the members continue to have all
     of the ownership rights in the continuing entity shall not in and of itself
     be deemed a "change of control" under (2) and/or (3), and a reorganization
     to convert MasterCard International from a membership to a stock company or
     a transaction resulting in the integration of Europay and MasterCard
     International shall not in and of itself constitute a "change of control;"

          (b) if MasterCard International becomes a stock corporation, the
     approval of its stockholders of (1) any consolidation or merger in which it
     is not the continuing or surviving corporation or pursuant to which shares
     of stock would be converted into cash, securities or other property, other
     than a merger in which the holders of stock immediately prior to the merger
     will have the same proportionate ownership interest (i.e., still own 100%
     of total) of common stock of the surviving corporation immediately after
     the merger, (2) any sale, lease, exchange or other transfer (in one
     transaction or a series of related transactions) of all or substantially
     all of its assets, or (3) adoption of any plan or proposal for its
     liquidation or dissolution;

          (c) any "person" (as defined in Section 13(d) of the Securities
     Exchange Act of 1934), other than MasterCard International or a subsidiary
     or employee benefit plan or trust maintained by MasterCard International or
     any of its subsidiaries, becoming (together with its "affiliates" and
     "associates," as defined in Rule 12b-2 under the Exchange Act) the
     "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
     directly or indirectly, of more than 25% of the stock outstanding at the
     time, without the prior approval of the board of directors; or

          (d) a majority of the voting directors proposed on a slate for
     election by the members are rejected by a vote of those members.

                                       136
<PAGE>

                         SECURITY OWNERSHIP OF CERTAIN
                        BENEFICIAL OWNERS AND MANAGEMENT


     The table below sets forth certain information with respect to the
principal members of MasterCard International who, together with their
affiliates, are entitled to vote 5% or more of the total number of votes
eligible to be cast at the special meeting of principal members of MasterCard
International in connection with which we are distributing this proxy
statement-prospectus. None of the directors or executive officers of MasterCard
International beneficially owns any of the voting power with respect to the
votes to be cast at the meeting. To the best of our knowledge, each beneficial
owner has sole voting power and investment power with respect to the votes that
it is eligible to cast. A total number of 1,536,772,585 votes are eligible to be
cast at the meeting.


     Information in the following table is based on the historic global proxy
calculation for the period ended September 30, 2001.


<Table>
<Caption>
                                                                 PRIOR TO CONVERSION AND INTEGRATION
                                                              -----------------------------------------
                      NAME AND ADDRESS                          NUMBER OF VOTES      PERCENT OF VOTES
                    OF BENEFICIAL OWNER                       ELIGIBLE TO BE CAST   ELIGIBLE TO BE CAST
                    -------------------                       -------------------   -------------------
<S>                                                           <C>                   <C>
Citicorp Credit Services, Inc. .............................      124,081,529              8.1%
  14700 Citicorp Drive
  Hagerstown, MD 21742
Chase Manhattan Bank USA, N.A. .............................      122,591,588              8.0%
  100 Duffy Avenue
  Hicksville, NY 11801
First USA Bank, N.A. .......................................      104,596,601              6.8%
  A Bank One Company
  201 North Walnut Street
  15th Floor
  Wilmington, DE 19801
</Table>


     Additionally, the table below sets forth certain information, as of the
date immediately following the completion of the conversion and integration,
with respect to the beneficial ownership of our class A redeemable common stock
and class B convertible common stock by each person who we know will be the
beneficial owner of more than 5% of any class or series of our capital stock.
None of the directors or executive officers of MasterCard Incorporated will
beneficially own any of our class A redeemable or class B convertible common
stock following the conversion and integration. To the best of our knowledge,
each beneficial owner of class A redeemable common stock and class B convertible
common stock will have sole voting power and sole investment power with respect
to all of the class A redeemable and class B convertible shares that it owns.
This table does not give effect to shares that may be acquired pursuant to
options because no shares may be so acquired within 60 days from the date of
this proxy statement-prospectus.


<Table>
<Caption>
                                                      AFTER CONVERSION AND INTEGRATION
                                  ------------------------------------------------------------------------
                                   SHARES OF      PERCENT OF     SHARES OF      PERCENT OF     PERCENT OF
                                    CLASS A        CLASS A        CLASS B        CLASS B         TOTAL
                                   REDEEMABLE     REDEEMABLE    CONVERTIBLE    CONVERTIBLE    OUTSTANDING
                                  COMMON STOCK   COMMON STOCK   COMMON STOCK   COMMON STOCK   COMMON STOCK
NAME AND ADDRESS                  BENEFICIALLY   BENEFICIALLY   BENEFICIALLY   BENEFICIALLY   BENEFICIALLY
OF BENEFICIAL OWNER                  OWNED          OWNED          OWNED          OWNED          OWNED
-------------------               ------------   ------------   ------------   ------------   ------------
<S>                               <C>            <C>            <C>            <C>            <C>
Citicorp Credit Services,
  Inc...........................  5.08 million       6.0%       .97 million         6.0%          6.0%
  14700 Citicorp Drive
  Hagerstown, MD 21742
Chase Manhattan Bank USA, N.A...  4.50 million       5.4%       .86 million         5.4%          5.4%
  100 Duffy Avenue
  Hicksville, NY 11801
EURO Kartensysteme EUROCARD und
  eurocheque GmbH...............  4.39 million       5.2%       .84 million         5.2%          5.2%
  Solmsstrasse 2-26
  60648 Frankfurt/Main
  Germany
</Table>


                                       137
<PAGE>


<Table>
<Caption>
                                                      AFTER CONVERSION AND INTEGRATION
                                  ------------------------------------------------------------------------
                                   SHARES OF      PERCENT OF     SHARES OF      PERCENT OF     PERCENT OF
                                    CLASS A        CLASS A        CLASS B        CLASS B         TOTAL
                                   REDEEMABLE     REDEEMABLE    CONVERTIBLE    CONVERTIBLE    OUTSTANDING
                                  COMMON STOCK   COMMON STOCK   COMMON STOCK   COMMON STOCK   COMMON STOCK
NAME AND ADDRESS                  BENEFICIALLY   BENEFICIALLY   BENEFICIALLY   BENEFICIALLY   BENEFICIALLY
OF BENEFICIAL OWNER                  OWNED          OWNED          OWNED          OWNED          OWNED
-------------------               ------------   ------------   ------------   ------------   ------------
<S>                               <C>            <C>            <C>            <C>            <C>
First USA Bank, N.A. ...........  4.20 million       5.0%       .80 million         5.0%          5.0%
  A Bank One Company
  201 North Walnut Street
  15th Floor
  Wilmington, DE 19801
Europay France S.A. ............  4.22 million       5.0%       .80 million         5.0%          5.0%
  44, rue Cambronne
  75740 Paris Cedex 15
  France
</Table>


                                       138
<PAGE>

                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS


     Pursuant to an agreement, dated as of March 1, 1999, among MasterCard
International and Citibank, N.A., including certain of its affiliates, Citibank
has agreed, among other things, to increase, and then maintain, the overall
percentage of payment cards issued by Citibank that are MasterCard branded, in
exchange for certain pricing terms. MasterCard and Europay provide
authorization, clearing and settlement services in connection with transactions
for which Citibank or its affiliates act as issuer or acquirer. In addition,
Citibank uses several of MasterCard's fee-for-service products. A portion of
MasterCard International's $1.2 billion dollar credit facility is syndicated to
Citibank, N.A., for which Citibank and its affiliates receive a fee; Citibank is
the administrative agent of that facility and Salomon Smith Barney Inc., an
affiliate of Citibank, is the lead arranger and book manager of that facility.
Additional amounts are paid by MasterCard International for these services.
Another insurance affiliate of Citibank is a creditor of MasterCard
International in connection with a portion of the $149 million lease financing
for our O'Fallon, Missouri operations facility. In addition, Citibank and its
affiliates receive fees from MasterCard for cash management, asset management
and investment banking services. Citibank also acts as issuer of MasterCard's
corporate purchasing cards. For 2000, fees earned from Citibank and its
affiliates, as of the date of this proxy statement-prospectus, net of
contractual obligations under the agreement described above, were approximately
$140 million. Robert B. Willumstad, a member of our board of directors, is the
Chief Executive Officer of Citigroup's Global Consumer Group, an affiliate of
Citibank, N.A. As a result of the conversion and integration, Citibank, N.A.,
and its affiliates are expected to own approximately 6.0% of our class A
redeemable and class B convertible common stock on a combined basis.



     Pursuant to an agreement, dated as of July 1, 1999, between MasterCard and
The Chase Manhattan Bank, The Chase Manhattan Bank has agreed, among other
things, to continue to increase, and then maintain, the annual percentage of
payment cards issued by Chase that are MasterCard branded, in exchange for
certain pricing terms. MasterCard and Europay provide authorization, clearing
and settlement services in connection with transactions for which The Chase
Manhattan Bank or its affiliates act as issuer or acquirer. In addition, The
Chase Manhattan Bank uses several of MasterCard's fee-for-service products. A
portion of MasterCard International's $1.2 billion dollar credit facility is
syndicated to The Chase Manhattan Bank, for which The Chase Manhattan Bank
receives a fee. In addition, The Chase Manhattan Bank and its affiliates receive
amounts from MasterCard for cash management services. The Chase Manhattan Bank
acts as issuer of MasterCard's corporate cards and provides a variety of banking
services for MasterCard employees pursuant to arrangements entered into with
MasterCard. MasterCard provides certain financial and other incentives to The
Chase Manhattan Bank for co-branded and affinity card programs issued by Chase.
For 2000, fees earned from The Chase Manhattan Bank and its affiliates, as of
the date of this proxy statement-prospectus, net of contractual obligations
under the agreement described above, were approximately $110 million. David A.
Coulter, a member of our board of directors, is Vice Chairman of J.P. Morgan
Chase & Co., of which The Chase Manhattan Bank is an affiliate, and Donald L.
Boudreau, our Chairman Emeritus, is a former executive officer of The Chase
Manhattan Bank. As a result of the conversion and integration, The Chase
Manhattan Bank and its affiliates are expected to own approximately 5.4% of our
class A redeemable and class B convertible common stock on a combined basis.



     Under the terms of a licensing agreement with Europay, EURO Kartensysteme
EUROCARD und eurocheque GmbH, or EKS, is the principal licensee for certain
Europay brands and payment products in Germany. EKS owns a 15.3% equity interest
in Europay and is a principal member of MasterCard International. In connection
with the conversion and integration, EKS may enter into one or more agreements
with MasterCard Incorporated, MasterCard International and/or Europay pursuant
to which, among other things, EKS will assign to Europay certain trademarks,
trade names and other intellectual property rights, and MasterCard and Europay
will provide support for marketing initiatives designed to migrate all uses by
German members of the Eurocard-MasterCard brand on cards, acceptance decals,
advertising and other materials to the MasterCard brand mark. For 2000, fees
earned by Europay from EKS were approximately E65 million. Jan A. M. Hendrikx, a
member of our board of directors, is Chief Executive Officer of EKS and a member
of the board of directors of Europay. As a result of the conversion and
integration, EKS is expected to own approximately 5.2% of our class A redeemable
and class B convertible common stock.


                                       139
<PAGE>


     MasterCard and Europay provide authorization, clearing and settlement
services in connection with transactions for which Bank One or its affiliates,
including First USA Bank, N.A., act as issuer or acquirer. For 2000, fees earned
from Bank One and its affiliates, as of the date of this proxy
statement-prospectus were approximately $110 million. As a result of the
conversion and integration, Bank One and its affiliates are expected to own
approximately 5.0% of our class A redeemable and class B convertible common
stock on a combined basis.


     Europay France S.A., a company formed by certain French financial
institutions to promote Europay brands and payment products in France, owns a
15.3% equity interest in Europay and is a principal member of MasterCard
International. For 2000, fees earned by Europay from Europay France were
approximately E21 million. Jean-Pierre Ledru, a member of our board of
directors, is Chairman and Chief Executive Officer of Europay France and
Chairman of Europay. As a result of the conversion and integration, Europay
France is expected to own approximately 5.0% of our class A redeemable and class
B convertible common stock.

                                       140
<PAGE>

            DESCRIPTION OF CAPITAL STOCK OF MASTERCARD INCORPORATED

     The following summary of MasterCard Incorporated's capital stock describes
the material terms of the stock. For a complete description, we refer you to
MasterCard Incorporated's charter and bylaws, which are attached as Annexes D
and E to this proxy statement-prospectus.

GENERAL

     Capitalization.  The authorized capital stock of MasterCard Incorporated
consists of:

     - 275 million shares of class A redeemable common stock, par value $.01 per
       share;

     - 25 million shares of class B convertible common stock, par value $.01 per
       share; and

     - 75 million shares of class C common stock, par value $.01 per share.

     Immediately following the closing of the conversion and integration, 84
million shares of class A redeemable common stock will be issued and
outstanding, 16 million shares of class B convertible common stock will be
issued and outstanding and no shares of class C common stock will be issued and
outstanding. MasterCard Incorporated may only issue the class B convertible
common stock in connection with the transactions contemplated by the integration
agreement.

     Conversion of Class B convertible common stock.  Each share of class B
convertible common stock, except shares that constitute ec Pictogram shares,
will automatically be converted into one share of class A redeemable common
stock on the third anniversary of the first day of the first fiscal quarter
beginning after the fiscal quarter in which the closing of the conversion and
integration occurs. Shares of class B convertible common stock that are ec
Pictogram shares will automatically be converted into one share of class A
redeemable common stock on the second anniversary of the day on which all of the
other shares of class B convertible common stock were converted and some or all
of these shares will be allocated among the members of MasterCard responsible
for ec Pictogram volumes to the extent such volumes have been previously
converted to Maestro, in accordance with the terms of the integration agreement.
Any remaining shares will be allocated to non-European member-stockholders.

     Reallocation.  At the conclusion of the three year transition period, all
shares of class A redeemable common stock, including class A redeemable common
stock resulting from the conversion of class B convertible common stock, will be
subject to reallocation as described more fully under "Share Allocation and the
Global Proxy -- Reallocation of Shares at the Conclusion of the Transition
Period." In connection with this reallocation, shareholders may be required to
return some or all of their common stock to MasterCard Incorporated for
reallocation. In addition, ec Pictogram shares will be subject to reallocation
at the conclusion of an additional two year period following the transition
period as described more fully under "-- Conversion of Class B Convertible
Common Stock" above.

     Fractional Shares.  No fractional shares of class A redeemable or class B
convertible common stock will be issued or delivered by MasterCard Incorporated.
Any fractional share interests will be rounded to a whole share in such manner
as the management of MasterCard Incorporated may determine in its sole
discretion.

VOTING RIGHTS, DIVIDEND RIGHTS AND LIQUIDATION RIGHTS

     Voting Rights.  Each holder of class A redeemable and class B convertible
common stock has the right to cast one vote for each share of class A redeemable
and class B convertible common stock held of record on all matters submitted to
a vote of stockholders of MasterCard Incorporated. At the end of the transition
period, all shares of class B convertible common stock, except for class B
convertible shares relating to ec Pictogram, will be converted into class A
redeemable common stock. Following this conversion, the remaining class B
convertible common stock will have no voting rights. At all times, each holder
of class A redeemable and class B convertible common stock, together with its
affiliates, will be subject to a 7% voting limitation in the election of
directors regardless of the number of shares owned. This provision may be
altered by a majority vote of the MasterCard Incorporated board of directors or
by a majority of the holders of the class A redeemable common stock and class B
convertible common stock voting together as a single class (so long as
                                       141
<PAGE>

the class B convertible stock has voting rights). However, approval of at least
75% of the directors present at a meeting at which a quorum is present is
required to raise the limitation on voting for directors to more than 15% of the
shares that are entitled to vote in the election of directors. The above
provisions may be amended only with the approval of 75% of the directors present
at a meeting at which a quorum is present and the approval of the holders of a
majority of the outstanding class A redeemable and class B convertible common
stock voting together as a single class (so long as the class B convertible
stock has voting rights).

     Dividend Rights.  The holders of shares of class A redeemable and class B
convertible common stock are entitled to share ratably in dividends or
distributions, if, as and when dividends or distributions are declared by the
board of directors of MasterCard Incorporated at its discretion. MasterCard
Incorporated has no current plans to pay cash dividends on the common stock.

     Liquidation Rights.  Upon dissolution, liquidation or winding-up of
MasterCard Incorporated, holders of class A redeemable and class B convertible
common stock are entitled to share ratably in the net assets available for
distribution to stockholders after the payment of debts and other liabilities,
subject to the prior rights of any issued preferred shares.

     Redemption Rights.  If, within three years after the closing of the
conversion, a stockholder of MasterCard Incorporated ceases to be a principal
member of MasterCard International (other than in connection with a permitted
transfer of shares as described under "-- Transfer Restrictions" below),
MasterCard Incorporated will redeem that stockholder at par value. If more than
three years have elapsed since the conversion and a stockholder of MasterCard
Incorporated ceases to be a principal member of MasterCard International,
MasterCard Incorporated may, at its option, redeem the shares of that
stockholder for their book value based on MasterCard Incorporated's financial
statements most recently filed with the Securities and Exchange Commission. If
MasterCard Incorporated does not redeem the stockholder's shares, the
stockholder will be required to offer the unpurchased shares to the other
stockholders in accordance with procedures to be established by the board of
directors.

     Certain Purchase and Sale Obligations.  Beginning three years after the
conversion and integration, no stockholder may own common stock representing
more than 125% or less than 75% of that stockholder's most recent global proxy
calculation. Stockholders may be required to purchase or sell shares of
MasterCard Incorporated in order to satisfy these requirements within 12 months
of receipt of notice from MasterCard Incorporated that such purchase or sale is
required. Any sales of shares would ordinarily constitute taxable transactions.
Stockholders who need to sell shares in order to satisfy the 125% requirement
are obligated under the bylaws of MasterCard Incorporated to accept the highest
price offered to them for the shares that are required to be sold.

     To the extent that member-stockholders are required to purchase shares in
order to satisfy the 75% minimum ownership requirement, shares will be available
either directly from MasterCard Incorporated or from other member-stockholders
that either are required to sell shares in order to satisfy the 125% maximum
ownership requirement or otherwise desire to sell shares. The board of directors
of MasterCard Incorporated is authorized to establish procedures by which shares
of MasterCard Incorporated common stock will be traded among member-stockholders
or purchased or sold by MasterCard. Methods for the purchase and disposition of
shares may include some or all of the following: an on-line bulletin board that
matches buyers and sellers of shares; a periodic auction conducted on behalf of
MasterCard Incorporated for buyers and sellers of shares; and directly
negotiated purchases and sales of shares. The price at which shares may be
purchased or sold will be determined through these methods. MasterCard
Incorporated will not charge member-stockholders any commissions for
facilitating trading in its shares.

     MasterCard Incorporated will purchase or sell its common stock subject to
its having sufficient capital available to effect each purchase transaction, and
only if each purchase or sale transaction is permitted under the laws, rules and
regulations applicable to MasterCard Incorporated at the time (including
securities laws). In particular, to the extent any offer by MasterCard
Incorporated to purchase its shares constitutes a tender offer under the
Exchange Act, MasterCard Incorporated will comply with the applicable tender
offer rules and regulations. In addition, MasterCard Incorporated will undertake
activities to facilitate trading of its common stock among member-stockholders
only to the extent such activities are permitted under the federal and state
                                       142
<PAGE>

securities laws of the United States and related rules and regulations. Any
shares subsequently sold by MasterCard Incorporated may not be registered under
the Securities Act of 1933, as amended, and accordingly may be subject to resale
restrictions under the Securities Act.

     Rights.  Holders of class A redeemable and class B convertible common stock
have the right under the terms of the integration agreement and as provided for
in the bylaws of MasterCard Incorporated to receive additional shares at the end
of the three-year transition period to the extent that their new global proxy
calculation for the third year of the transition period (calculated on a
European or non-European basis, as the case may be) exceeds their initial
allocation of shares. See "Share Allocation and the Global Proxy -- Reallocation
of Shares at the Conclusion of the Transition Period." Similarly, holders of
class A redeemable and class B convertible common stock have the right to
receive additional shares in certain circumstances in connection with the
reallocation of ec Pictogram shares. See "Share Allocation and the Global
Proxy -- Conversion and Reallocation of ec Pictogram Shares." Members receiving
additional shares at the end of the three-year transition period and/or in
connection with the reallocation of ec Pictogram shares will do so pursuant to
rights initially granted with all shares of class A redeemable and class B
convertible common stock of MasterCard Incorporated. Each right is transferable
only with the applicable shares of class A redeemable and class B convertible
common stock, expires or terminates upon completion of the final reallocation
and is not redeemable except together with the redemption of a share of class A
redeemable or class B convertible common stock. Other than the right and as
otherwise described herein, holders of class A redeemable and class B
convertible common stock do not have any rights to purchase additional shares of
stock from MasterCard Incorporated, to have their common stock converted into or
exchanged for other securities (except for the conversion of class B convertible
shares into class A redeemable shares as described above), to have their common
stock repurchased by MasterCard Incorporated or to receive a preferred return on
their shares of common stock.

     Class C Common Stock.  Shares of class C common stock may be issued from
time to time with voting powers, designations, preferences and other rights to
be determined by the MasterCard Incorporated board of directors, provided that
no shares of class C common stock may be entitled to voting rights, dividends or
rights to participate in the proceeds of a liquidation that are greater than the
corresponding rights of the class A redeemable common stock. The MasterCard
Incorporated certificate of incorporation provides that any issuance of class C
common stock requires the approval of two-thirds of the board of directors, and
that any issuance of voting class C common stock or class C common stock that,
together with all other issuances of class C common stock made during the
immediately preceding two years, represents greater than 5% of the total number
of class A redeemable shares and class B convertible shares outstanding prior to
the issuance requires the approval of 75% of the board of directors. These
provisions may be amended only with the approval of 75% of the directors present
at a meeting at which a quorum is present and the approval of the holders of a
majority of the outstanding class A redeemable and class B convertible common
stock voting together as a single class (so long as the class B convertible
stock has voting rights).

TRANSFER RESTRICTIONS

     For three years following the closing of the conversion, no transfer of
shares of common stock and no assignment of the right to receive shares will be
permitted except:

     - in connection with a transfer of all or substantially all of a
       stockholder's card portfolio;

     - in the event that a stockholder that was a principal member becomes an
       affiliate member of another principal member, in which case the
       stockholder may transfer its common stock to the principal member with
       which it becomes affiliated;

     - in the event that a stockholder that was a principal member with one or
       more affiliate members ceases to be a principal member and one or more of
       its affiliate members thereupon become principal members, in which case
       the stockholder may transfer its common stock to the former affiliate
       members;

                                       143
<PAGE>

     - if a stockholder is prohibited from holding the common stock of
       MasterCard Incorporated by applicable regulatory requirements, in which
       case the stockholder may transfer its common stock to an affiliate that
       is permitted to hold the stock, with the prior approval of the board of
       directors of MasterCard Incorporated; and

     - a stockholder may transfer shares to a class A member of MasterCard
       International that is an affiliate of such stockholder with the approval
       of the board of directors of MasterCard Incorporated. For these purposes,
       an affiliate is any parent company that directly or indirectly owns 80%
       or more of the voting power and economic interests in the stockholder,
       and any entity of which the stockholder or any of such parents owns 80%
       or more of the voting power and economic interests.

The permissible transfers described above apply only to transfers of all, but
not less than all, of a stockholder's shares in MasterCard Incorporated.

     After three years, each stockholder must maintain an ownership percentage
of MasterCard Incorporated common stock that is no less than 75% and no more
than 125% of the stockholder's most recent global proxy calculation.
Stockholders may be required to purchase or sell shares of MasterCard
Incorporated in order to satisfy these requirements within 12 months of receipt
of notice from MasterCard Incorporated that such purchase or sale is required.
Any sales of shares would ordinarily constitute taxable transactions.
Stockholders who need to sell shares in order to satisfy the 125% requirement
are obligated under the bylaws of MasterCard Incorporated to accept the highest
price offered to them for the shares that are required to be sold. In addition:

     - only class A members of MasterCard International may own shares of class
       A redeemable and class B convertible common stock of MasterCard
       Incorporated; and

     - unless otherwise approved by a two-thirds vote of the MasterCard
       Incorporated board of directors, no stockholder together with its
       affiliates may own more than 15% of the outstanding shares of voting
       stock of MasterCard Incorporated.

     Following the three year transition period, MasterCard Incorporated intends
to facilitate trading of its common stock among class A members of MasterCard
International according to procedures to be established by the board of
directors of MasterCard Incorporated. See "-- Certain Purchase or Sale
Obligations."

     The shares of MasterCard Incorporated common stock that MasterCard
International members will own following the conversion and integration have
been registered under the Securities Act of 1933. They may be traded in
accordance with the transfer restrictions contained in this section by you if
you are not an affiliate of MasterCard International under the Securities Act.
An "affiliate" as defined by the rules under the Securities Act is a person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, MasterCard International.
Persons who are affiliates of MasterCard International may not sell their shares
of MasterCard Incorporated common stock acquired in the merger except pursuant
to an effective registration statement under the Securities Act or an applicable
exemption from the requirements of the Securities Act, including Rules 144 and
145 issued by the SEC under the Securities Act. Affiliates generally include
directors, executive officers and beneficial owners of 10% or more of any class
of capital stock.

TRANSFER AGENT

     Initially, MasterCard Incorporated will be the transfer agent and registrar
of the common stock.

LIMITATIONS ON A CHANGE OF CONTROL

     We summarize below several provisions of our certificate of incorporation
and bylaws and the Delaware General Corporation Law. These provisions could have
the effect of delaying, deferring or preventing a change in control of
MasterCard Incorporated or deterring potential acquirers from making an offer to
our stockholders. This could be the case even though a majority of our
stockholders might benefit from such a change in control or offer. These
descriptions are not complete and we refer you to the documents that we have
filed as exhibits to this proxy statement-prospectus and to the Delaware General
Corporation Law.

                                       144
<PAGE>

     Supermajority Vote of the Board of Directors.  Our certificate of
incorporation requires the approval of 75% of the directors present at a meeting
at which a quorum is present and the approval of the holders of a majority of
the outstanding class A redeemable and class B convertible common stock voting
together as a single class (so long as the class B convertible common stock has
voting rights) to: alter our status as a stock corporation; amend our
certificate of incorporation to authorize MasterCard Incorporated to issue stock
other than class A redeemable, B convertible or C common stock; sell, lease or
exchange all or substantially all of MasterCard Incorporated's assets; approve
the sale, lease or exchange of all or substantial all of the assets of
MasterCard International; engage in a business combination (merger or
consolidation) involving either MasterCard Incorporated or MasterCard
International; undertake an initial public offering; amend the MasterCard
International certificate of incorporation to allow MasterCard International to
issue capital stock, to create additional classes of membership interests in
MasterCard International, to subject the property of the members of MasterCard
International to the obligations of MasterCard International or to subject
non-U.S. programs to the satisfaction of any liabilities arising from the
current DOJ and merchant antitrust litigations in the United States; or amend
the provisions of the MasterCard International bylaws relating to special
assessments that may be imposed upon the members of MasterCard International.
Other provisions of the certificates of incorporation and by-laws of MasterCard
Incorporated and MasterCard International may be modified only if certain
supermajorities are achieved, and these provisions may have the effect of
deterring potential acquirors. See "Comparison of Rights of MasterCard
International Members Before and After the Conversion and Integration."

     Ability to Call Special Meetings.  Special meetings of MasterCard
Incorporated stockholders may be called at any time for any purpose by written
request of the chairman of the board of directors or the President and Chief
Executive Officer of MasterCard Incorporated. Special meetings may also be
called by the Secretary upon the written request of at least 33 1/3% of the
board of directors or the holders of at least 25% of the outstanding shares
entitled to vote on the action being proposed. Notice of a special meeting must
state the time, place and date of the meeting, the name of the person or persons
calling the meeting, the purpose for which the meeting is called and the means
of acceptable remote participation. The business transacted at the special
meeting is limited to the purpose described in the notice.

     15% Share Ownership Limitation.  Unless otherwise approved by a two-thirds
vote of the MasterCard board of directors, no stockholder together with its
affiliates may own more than 15% of the outstanding shares of voting stock of
MasterCard Incorporated.

     7% Voting Power Limitation.  Each holder of class A redeemable and class B
convertible common stock, together with its affiliates, will be subject to a 7%
voting limitation in the election of directors regardless of the number of
shares owned.

     Only Class A Members of MasterCard International may be Stockholders of
MasterCard Incorporated. Only class A members of MasterCard International may
own shares of class A redeemable and class B convertible common stock of
MasterCard Incorporated.

     Authorized but Unissued Shares of Class C Common Stock.  Since the board of
directors of MasterCard Incorporated may issue shares of class C common stock
and set the voting powers, designations, preferences and other rights related to
that stock, any issuance of class C shares may delay or prevent a change of
control.

DELAWARE ANTI-TAKEOVER STATUTE

     Under Section 203 of the business combination statute of Delaware law, a
corporation is prohibited from engaging in any business combination with an
interested stockholder who, together with its affiliates or associates, owns 15%
or more of the corporation's voting stock for a three year period following the
time the stockholder became an interested stockholder, unless:

     - prior to the time the stockholder became an interested stockholder, the
       board of directors of the corporation approved either the business
       combination or the transaction which resulted in the stockholder becoming
       an interested stockholder;

                                       145
<PAGE>

     - the interested stockholder owned at least 85% of the voting stock of the
       corporation, excluding specified shares, upon completion of the
       transaction which resulted in the stockholder becoming an interested
       stockholder; or

     - at or subsequent to the time the stockholder became an interested
       stockholder, the business combination is approved by the board of
       directors of the corporation and authorized by the affirmative vote, at
       an annual or special meeting and not by written consent, of at least
       66 2/3% of the outstanding voting shares of the corporation, excluding
       shares held by that interested stockholder.

     A business combination generally includes:

     - mergers, consolidations and sales or other dispositions of 10% or more of
       the assets of a corporation to or with an interested stockholder;

     - specified transactions resulting in the issuance or transfer to an
       interested stockholder of any capital stock of the corporation or its
       subsidiaries; and

     - other transactions resulting in a disproportionate financial benefit to
       an interested stockholder.

     The provisions of the Delaware business combination statute do not apply to
a corporation if, subject to certain requirements, the certificate of
incorporation or by-laws of the corporation contain a provision expressly
electing not to be governed by the provisions of the statute or the corporation
does not have voting stock listed on a national securities exchange, authorized
for quotation on an inter-dealer quotation system of a registered national
securities association or held of record by more than 2,000 stockholders.

     Although MasterCard Incorporated does not plan to "opt out" of this
provision, Section 203 will not apply as long as we have fewer than 2,000
stockholders. In addition, the provision may not be meaningful as a result of
certain provisions of our certificate of incorporation and bylaws, including the
provision prohibiting stockholders from holding more than 15% of our outstanding
common stock.

LIMITATION OF PERSONAL LIABILITY OF DIRECTORS AND OFFICERS

     Delaware law provides that a corporation may include in its certificate of
incorporation a provision limiting or eliminating the liability of its directors
to the corporation and its stockholders for monetary damages arising from a
breach of fiduciary duty, except for:

     - a breach of the duty of loyalty to the corporation or its stockholders;

     - acts or omissions not in good faith or which involve intentional
       misconduct or a knowing violation of law;

     - payment of a dividend or the repurchase or redemption of stock in
       violation of Delaware law; or

     - any transaction from which the director derived an improper personal
       benefit.

     Our certificate of incorporation provides that, to the fullest extent
Delaware law permits the limitation or elimination of the liability of
directors, none of our directors will be liable to us or our stockholders for
monetary damages for breach of fiduciary duty as a director.

INDEMNIFICATION OF DIRECTORS AND OFFICERS

     Our bylaws require, among other things, that we indemnify our officers and
directors against all expenses, including attorney's fees, incurred in any
action, suit or proceeding by reason of the fact that the person is or was a
director, officer, employee or agent of MasterCard Incorporated. We are also
permitted to advance to the officers and directors all related expenses, subject
to reimbursement if it is determined subsequently that indemnification is not
permitted.

                                       146
<PAGE>

                     MATERIAL CONTRACTS BETWEEN MASTERCARD
                           INTERNATIONAL AND EUROPAY

     We summarize below the material contracts between MasterCard International
and Europay before the conversion and integration. If the conversion and
integration are completed, these agreements will be terminated.

ALLIANCE AGREEMENT

     MasterCard International and Europay are parties to an Alliance Agreement,
dated as of November 14, 1996, that provides for a broad alliance between the
two companies and sets forth the terms and conditions under which MasterCard
International and Europay agreed to improve the acceptance, visibility, brand
awareness and technological support of the MasterCard brand in Europe.

     Under the Alliance Agreement, MasterCard International agreed to grant
Europay the exclusive right to elect new European members for the non-exclusive
use of the MasterCard brand marks in Europe and agreed to approve and execute
new member agreements and/or licenses on a non-exclusive basis for newly elected
European members and/or licensees for use of the MasterCard brand marks in
Europe.

MAESTRO AGREEMENT

     MasterCard International and Europay are also parties to a Maestro
Agreement, dated as of June 19, 1997, that provides for the joint development,
promotion and management by MasterCard International and Europay of Maestro
International Incorporated. Maestro International Incorporated is 50% owned by
MasterCard International and 50% owned by Europay. Maestro International grants
licenses to use and to grant sublicenses for the Maestro brands to MasterCard
and Europay for each of the regions of the world.

                                       160

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>6
<FILENAME>y62026exv99w2.txt
<DESCRIPTION>NEWS RELEASE
<TEXT>
<PAGE>
NEWS RELEASE                                                     MASTERCARD
                                                                 INTERNATIONAL
                                                                 ---------------

Contacts:
Sharon Gamsin, 914-249-5622

              MASTERCARD MERGES WITH EUROPAY TO FORM A UNIFIED,
                  SHAREHOLDER-OWNED, GLOBAL PAYMENTS COMPANY

   CENTERS OF EXCELLENCE ESTABLISHED TO LEVERAGE EXPERTISE AROUND THE GLOBE

PURCHASE, NY AND WATERLOO, BELGIUM, JULY 1, 2002 - The conversion of MasterCard
International into a private share corporation and its merger with Europay
International have been completed, creating a unified, shareholder-owned global
payments company, which will deliver significant benefits to customers around
the globe.

"The integration of MasterCard and Europay unites two of the strongest players
in the payments business so that we can now deploy a truly globally integrated,
regionally sensitive strategic model," said Robert W. Selander, MasterCard's
president and CEO.  "By integrating with Europay, we're enhancing our ability
to deliver high-quality, reliable payment solutions to our members globally,
while maintaining regional flexibility that is responsive to local market
requirements and conditions."

Selander said that by joining Europay's strength in m-commerce, smart cards,
and debit cards with MasterCard's leadership in customer relationship
management, award-winning brand marketing, and leading-edge processing
technology, "the financial institutions we serve will receive superior support
and delivery whether they operate in one country, on one continent, or in
diverse markets around the world."

Europay, MasterCard's long-standing strategic ally in Europe, is being
integrated into the global organization as MasterCard's Europe Region.  The
Europe Region will continue to be based in Waterloo, Belgium. Dr. Peter Hoch,
Europay's chief executive, will continue his leadership as president of
MasterCard's Europe Region, reporting to Selander.

"Europay has just marked another critical milestone, with over 300 million
cards now issued in our region.  It's a proud moment at which to enter into
this merger," said Hoch.  "Our members have always benefited from our strategic
alliance with MasterCard but the benefits of working as a truly integrated
global company will now be all the greater."

With a unified governance and management structure, MasterCard will increase
strategic flexibility, strengthen customer responsiveness and shorten
time-to-market for innovative products and services, Selander said.  At the
same time, MasterCard's regions - Europe, Asia/Pacific, Latin
America/Caribbean, South Asia/Middle East/Africa and North America - will
maintain their regional boards and the ability to decide how best to implement
MasterCard's global strategy on a regional level, and establish rules and
policies that reflect local practices.

                                    -more-


<PAGE>
MASTERCARD INTERNATIONAL - PAGE 2
MASTERCARD MERGES WITH EUROPAY TO FORM A UNIFIED SHAREHOLDER-OWNED GLOBAL
PAYMENTS COMPANY
JULY 1, 2002

THE CONVERSION
--------------
To facilitate the merger transaction with Europay, MasterCard created a private
share corporation by issuing stock in a newly developed holding company,
MasterCard Incorporated, to its principal members. MasterCard International,
the membership corporation, will continue as MasterCard Incorporated's
principal operating subsidiary.

"As a private share corporation, we provide a tangible benefit to our principal
members, who are now our shareholders," Selander added. "They own stock in our
company and have a vested interest in enhancing the value of that stock by
moving more volume, revenue, and share to MasterCard."

Selander pointed out that as part of the process of becoming a private share
company, MasterCard publicly disclosed detailed information about its business,
and will file quarterly and annual financial reports with the U.S. Securities
and Exchange Commission.

"This increased level of financial transparency and precision is an important
advantage in today's business environment, and a key differentiator from our
competition," he said.

THE INTEGRATION
---------------
The integration of MasterCard and Europay provides an opportunity to create
substantial benefits for customers in terms of improved economies of scale,
elimination of duplication, and faster decision making. This means MasterCard
can be faster to market, delivering timely technology and marketing solutions
to customers.  Many of these benefits are already being realized.

Full globalization of MasterCard's processing functions, for example, will
provide a single set of applications and infrastructure for core processing,
with significant economies of scale.

The integration provides the opportunity for the Europe Region to further
benefit from MasterCard's global expertise in brand building, customer-centered
service, marketing consulting, and corporate payments expertise. For example,
MasterCard's award-winning PRICELESS(R) advertising campaign, now seen in 45
languages and in 90 countries, including key European markets, will be expanded
throughout the region, further enhancing the global reach and scope of
MasterCard's brand. European customers will also benefit from the delivery of
enhanced customized relationship management and consulting services.

CENTERS OF EXCELLENCE
---------------------
As part of the newly integrated company, MasterCard is launching global Centers
of Excellence in Belgium and the United States. The centers will provide the
best solutions to meet the dynamic needs of MasterCard's members and their
customers by offering information, resources, and tools to help build global
leadership.

The Center of Excellence for Debit and the Center of Excellence for Chip and
Mobile Commerce will be located in Waterloo, Belgium, to leverage Europay's
proven expertise in these areas. A third, the Center of Excellence for
e-Commerce and eB2B, will be located in Purchase, New York.

                                    -more-

<PAGE>
MASTERCARD INTERNATIONAL - PAGE 3
MASTERCARD MERGES WITH EUROPAY TO FORM A UNIFIED SHAREHOLDER-OWNED GLOBAL
PAYMENTS COMPANY
JULY 1, 2002


The Debit Center of Excellence will combine Europay's recognized "pay now"
leadership with MasterCard's significant success in debit in Asia/Pacific and
Latin America, and leverage this expertise globally. Maestro International is
joining with other MasterCard debit groups around the world in order to
maximize Maestro's global leadership position in online debit.

The Center of Excellence for Chip and Mobile Commerce will build on Europe's
expertise and experience to provide extensive and unique expertise in chip and
mobile commerce businesses and technologies to customers around the world.

The e-Commerce and eB2B Center of Excellence will support all aspects of
e-commerce product development for businesses and consumers. This includes
Internet channel security and cardholder authentication protocols, electronic
procurement systems, and other emerging technologies.

ABOUT MASTERCARD
----------------
MasterCard International has a comprehensive portfolio of well-known, widely
accepted payment brands including MasterCard(R), Cirrus(R) and Maestro(R). More
than 1.7 billion MasterCard, Cirrus and Maestro logos are present on credit,
charge and debit cards in circulation today. An association comprised of more
than 15,000 member financial institutions, MasterCard serves consumers and
businesses, both large and small, in 210 countries and territories.  MasterCard
is a leader in quality and innovation, offering a wide range of payment
solutions in the virtual and traditional worlds.  MasterCard's award-winning
PRICELESS(R) advertising campaign is now seen in 90 countries and in 45
languages, giving the MasterCard brand a truly global reach and scope. With more
than 24 million acceptance locations, no card is accepted in more places and by
more merchants than the MasterCard Card. For the year ended December 31, 2001
gross dollar volume exceeded US$986 billion.  MasterCard can be reached through
its World Wide Web site at http://www.mastercard.com.

THIS PRESS RELEASE CONTAINS FORWARD-LOOKING INFORMATION.  ALTHOUGH MASTERCARD
BELIEVES THAT ITS EXPECTATIONS ARE BASED ON REASONABLE ASSUMPTIONS, IT CAN GIVE
NO ASSURANCE THAT ITS GOALS WILL BE ACHIEVED.  IMPORTANT FACTORS THAT COULD
CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE FORWARD-LOOKING INFORMATION
CONTAINED IN THIS RELEASE INCLUDE: MASTERCARD'S ABILITY TO ACHIEVE ITS
STRATEGIC OBJECTIVES; MASTERCARD'S ABILITY TO REALIZE THE CONTEMPLATED BENEFITS
OF THE TRANSACTIONS; CHANGING MARKET CONDITIONS; AND OTHER MATTERS.  MASTERCARD
DISCLAIMS ANY OBLIGATION TO PUBLICLY UPDATE OR REVISE ANY FORWARD-LOOKING
INFORMATION.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>7
<FILENAME>y62026exv99w3.txt
<DESCRIPTION>CONSOLIDATED FINANCIAL STATEMENTS
<TEXT>
<PAGE>

                           EUROPAY INTERNATIONAL S.A.

                       CONSOLIDATED FINANCIAL STATEMENTS

                                       F-29
<PAGE>

                       REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors of
Europay International S.A.:


     In our opinion, the accompanying consolidated balance sheet and the related
consolidated statements of income and cash flows present fairly, in all material
respects, the financial position of Europay International S.A. (the "Company")
and its subsidiaries at December 31, 2001 and 2000, and the results of their
operations and their cash flows for the years then ended in conformity with
accounting principles generally accepted in the Belgium, expressed in euros.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements based
on our audit. We conducted our audit of these statements in accordance with
auditing standards generally accepted in the United States. Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.


     Accounting principles generally accepted in Belgium vary in certain
significant respects from accounting principles generally accepted in the United
States. The application of the latter would have affected the determination of
consolidated net income for the years ended December 31, 2001 and 2000, and the
determination of consolidated shareholders' equity and consolidated financial
position at December 31, 2001 and 2000, to the extent summarized in Note 19 to
the consolidated financial statements.

PricewaterhouseCoopers Reviseurs d'Entreprises
represented by

Yves Vandenplas

Brussels, Belgium
April 17, 2002

                                       F-30
<PAGE>

                           EUROPAY INTERNATIONAL S.A.

                          CONSOLIDATED BALANCE SHEETS
                                (IN E THOUSANDS)

<Table>
<Caption>
                                                                          AS OF DECEMBER 31,
                                                                          ------------------
                                                               NOTES       2001       2000
                                                              --------    -------    -------
<S>                                                           <C>         <C>        <C>
ASSETS
NON CURRENT ASSETS
Intangible assets...........................................     4         22,069      8,825
Fixed assets................................................     5         34,046     34,133
Financial assets............................................     6          1,943      2,029
                                                                          -------    -------
  Total Non Current Assets..................................               58,058     44,987
                                                                          -------    -------
CURRENT ASSETS
Amounts receivable within one year
  Trade debtors.............................................               37,490     45,915
  Other amounts receivable..................................   8, 16      129,177     46,619
                                                                          -------    -------
     Total amounts receivable within one year...............              166,667     92,534
Investments and deposits....................................     9          9,000      1,852
Cash at bank and in hand....................................     10        85,960    112,117
Deferred charges and accrued income.........................                4,060      2,679
                                                                          -------    -------
  Total Current Assets......................................              265,687    209,182
                                                                          -------    -------
          TOTAL ASSETS......................................              323,745    254,169
                                                                          =======    =======
CAPITAL AND RESERVES AND LIABILITIES
CAPITAL AND RESERVES
Issued Capital..............................................               17,611     17,611
Consolidated reserves.......................................     7         35,800     23,628
Consolidation difference....................................     6            383        383
Cumulative translation adjustment...........................                  268        235
                                                                          -------    -------
  Total Capital and Reserves................................               54,062     41,857
                                                                          -------    -------
MINORITY INTEREST...........................................     11         3,060      2,619
                                                                          -------    -------
PROVISION FOR LIABILITIES AND CHARGES.......................  5, 9, 15      3,579      2,301
                                                                          -------    -------
DEFERRED TAX................................................     16         4,817      2,792
                                                                          -------    -------
CREDITORS
Amounts payable within one year
  Bank overdrafts...........................................     10        63,618     37,789
  Suppliers.................................................     14        78,209     63,587
  Taxes.....................................................     16        19,288      2,150
  Remuneration and social security..........................     15        13,518      9,932
  Other amounts payable.....................................     12        82,918     89,749
                                                                          -------    -------
     Total amounts payable within one year..................              257,551    203,207
Accrued charges and deferred income.........................                  170      1,149
Amounts payable after one year..............................     13           506        244
                                                                          -------    -------
  Total Creditors...........................................              258,227    204,600
                                                                          -------    -------
TOTAL CAPITAL AND RESERVES AND LIABILITIES..................              323,745    254,169
                                                                          =======    =======
</Table>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.
                                       F-31
<PAGE>

                           EUROPAY INTERNATIONAL S.A.

                       CONSOLIDATED STATEMENTS OF INCOME
                                (IN E THOUSANDS)

<Table>
<Caption>
                                                                     FOR THE YEARS ENDED DECEMBER 31,
                                                                    ----------------------------------
                                                            NOTES     2001       2000         1999
                                                            -----   --------   --------   ------------
                                                                                          (UNAUDITED)
<S>                                                         <C>     <C>        <C>        <C>
OPERATING INCOME
Revenue...................................................   17     401,900    364,806      298,206
Capitalization of intangible assets.......................    4       7,737      7,822           --
Other operating income....................................            4,275      3,041        1,041
                                                                    -------    -------      -------
  Total operating income..................................          413,912    375,669      299,247
                                                                    -------    -------      -------
OPERATING EXPENSES
Services and other goods..................................   17     328,464    282,387      226,776
Remuneration, social security and pension costs...........   15      63,991     58,902       50,741
Depreciation and amortization expense.....................  4, 5     13,320     11,143        9,275
Bad debt expense..........................................               --         29          270
Increase/(decrease) in provisions for liabilities and
  charges.................................................   15        (227)       127           --
Other operating expenses..................................   14       3,438      4,858        4,864
                                                                    -------    -------      -------
  Total operating expenses................................          408,986    357,446      291,926
                                                                    -------    -------      -------
OPERATING PROFIT..........................................            4,926     18,223        7,321
FINANCIAL INCOME/(EXPENSE)
Interest income...........................................            1,338      1,072        1,131
Net other financial income/(expense)......................    9      22,487       (543)       6,855
Interest expense..........................................           (2,266)      (172)        (280)
                                                                    -------    -------      -------
  Net financial income....................................           21,559        357        7,706
                                                                    -------    -------      -------
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION.............           26,485     18,580       15,027
EXTRAORDINARY INCOME/(CHARGES)
Adjustments to amounts written off financial assets.......    6          --        184           --
Net gain/(loss) on disposal of fixed assets...............    5        (170)      (300)        (411)
Net use/(establishment) of provisions for liabilities and
  charges.................................................  5, 15    (2,087)    (1,353)          --
Other extraordinary charges...............................             (642)        --           --
                                                                    -------    -------      -------
  Net extraordinary income/(charges)......................           (2,899)    (1,469)        (411)
                                                                    -------    -------      -------
PROFIT FOR THE FINANCIAL PERIOD BEFORE TAXATION...........           23,586     17,111       14,616
INCOME TAXES..............................................   16     (10,734)    (7,447)      (6,721)
                                                                    -------    -------      -------
NET INCOME................................................           12,852      9,664        7,895
NET INCOME/(LOSS) FROM EQUITY INVESTEES, NET OF TAX.......    6        (239)      (158)          --
MINORITY INTEREST, NET OF TAX.............................   11        (441)      (253)        (254)
                                                                    -------    -------      -------
NET INCOME ATTRIBUTABLE TO THE GROUP......................           12,172      9,253        7,641
                                                                    =======    =======      =======
</Table>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.
                                       F-32
<PAGE>

                           EUROPAY INTERNATIONAL S.A.

                            SUPPLEMENTAL DISCLOSURE
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (IN E THOUSANDS)

<Table>
<Caption>
                                                              FOR THE YEARS ENDED DECEMBER 31,
                                                              ---------------------------------
                                                               2001       2000         1999
                                                              -------    -------    -----------
                                                                                    (UNAUDITED)
<S>                                                           <C>        <C>        <C>
OPERATING ACTIVITIES
Profit for the financial period before taxation.............   23,586     17,111       14,616
Adjustments to reconcile profit for the financial period
  before taxation to cash provided by/(used in) operating
  activities:
  Adjustments for non-cash (income)/expense:
     Adjustments to amounts written off financial assets....       --       (184)          --
     Depreciation and amortization expense..................   13,320     11,143        9,275
     Net (gain)/loss on disposals of fixed assets...........      170        300          411
  Changes in operating assets and liabilities:
     Trade debtors..........................................    8,425     (5,396)       7,986
     Other amounts receivable...............................  (82,558)   (33,161)      (6,932)
     Deferred charges and accrued income....................   (1,381)     8,272          761
     Security deposits......................................     (120)     1,028         (169)
     Suppliers..............................................   14,622      1,122        8,706
     Taxes paid.............................................    8,429     (4,868)      (5,911)
     Remuneration and social security.......................    3,586      2,550        1,389
     Other amounts payable..................................   (6,831)    64,440       10,910
     Accrued charges and deferred income....................     (979)    (2,366)       2,651
     Provision for liabilities and charges..................    1,278      2,061           --
                                                              -------    -------      -------
Net cash provided by/(used in) operating activities.........  (18,453)    62,052       43,693
                                                              -------    -------      -------
INVESTING ACTIVITIES
  Acquisitions of intangible assets.........................   (8,251)    (2,001)      (3,698)
  Capitalization of intangible assets.......................  (10,426)    (7,822)          --
  Acquisitions of fixed assets..............................   (8,202)   (13,761)      (9,839)
  Proceeds from sales of fixed assets.......................      232        548        3,805
  Investment in affiliates..................................       --         (5)         (92)
  Investment in short term cash deposits....................   (9,000)        --       (6,951)
  Proceeds from maturity of short term cash deposit.........       --      6,951           --
  Investment in foreign currency option.....................       --     (1,852)          --
  Proceeds from maturity of investment in foreign currency
     option.................................................    1,852         --           --
                                                              -------    -------      -------
Net cash used in investing activities.......................  (33,795)   (17,942)     (16,775)
                                                              -------    -------      -------
FINANCING ACTIVITIES
  Net change in bank overdrafts.............................   25,829     37,052          469
  Payment of short-term bank loan...........................       --         --      (19,831)
  Net change in amounts payable after one year..............      262     (2,289)          --
                                                              -------    -------      -------
Net cash provided by/(used in) financing activities.........   26,091     34,763      (19,362)
                                                              -------    -------      -------
Net increase/(decrease) in cash at bank and in hand.........  (26,157)    78,873        7,556
Cash at bank and in hand at beginning of year...............  112,117     33,244       25,688
                                                              -------    -------      -------
Cash at bank and in hand at end of year.....................   85,960    112,117       33,244
                                                              =======    =======      =======
</Table>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                       F-33
<PAGE>

                           EUROPAY INTERNATIONAL S.A.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                (IN E THOUSANDS)

1. ORGANIZATION

     Europay International S.A., incorporated in Belgium, manages and licenses
banks and banking organizations in Europe for payment systems trademarks such as
eurocheque, Eurocard-MasterCard, Maestro, Cirrus and Clip. Services provided
also include processing services such as authorization, clearing and settlement
of transactions carried out under the above mentioned trademarks. Europay also
engages in a variety of marketing activities designed to maintain and enhance
the value of the brands, and plays a leading role in the development of new
technologies aimed at facilitating and expanding electronic and mobile commerce.

2. LIST OF CONSOLIDATED ENTERPRISES AND ENTERPRISES INCLUDED USING THE EQUITY
METHOD

     The financial statements include the accounts of Europay and also the
accounts of the subsidiaries listed below.

<Table>
<Caption>
                                                                                                CHANGE OF
                                                                                              PERCENTAGE OF
                                                                               PROPORTION     CAPITAL HELD
                                                                  METHOD       OF CAPITAL     (AS COMPARED
NAME, FULL ADDRESS OF REGISTERED OFFICE AND FOR ENTERPRISES        USED         HELD IN      TO THE PREVIOUS
GOVERNED BY BELGIAN LAW, THE VAT NUMBER OR THE NATIONAL NUMBER  (SEE BELOW)     PERCENT          PERIOD)
--------------------------------------------------------------  -----------    ----------    ---------------
<S>                                                             <C>            <C>           <C>
MAESTRO INTERNATIONAL, INC..................................      E1              50.00           0.00
  Corporate Trust Center
  1209 Orange Street
  19801 Wilmington, Delaware
  UNITED STATES OF AMERICA
EUROPEAN PAYMENT SYSTEM SERVICES S.A........................      F               85.00           0.00
  Chaussee de Tervuren 198a
  1410 Waterloo
  BELGIUM
  BE 427.503.348
EUROTRAVELLERS CHEQUE INTERNATIONAL S.A.....................      F              100.00           0.00
Chaussee de Tervuren 198a
  1410 Waterloo
  BELGIUM
  BE 421.611.290
EUROPAY LIMITED (Dormant)...................................      F              100.00           0.00
  UNITED KINGDOM
EUROCARD U.S.A., INC........................................      F              100.00           0.00
  Fifth Avenue 500
  10110 New York, New York
  UNITED STATES OF AMERICA

E1 -- Associated enterprise accounted for using the equity method
F  -- Full consolidation
</Table>

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     The significant accounting policies used in the preparation of these
financial statements are set out below.

CONSOLIDATION

     Europay follows accounting principles and reporting requirements generally
accepted in Belgium ("Belgian GAAP"). Assets and liabilities are recorded under
the accrual method of accounting and valued at historical cost less any amounts
provided for possible reduction in value.

                                       F-34
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

     The consolidated financial statements include the accounts of Europay and
its majority-owned subsidiaries. All significant intercompany transactions are
eliminated in consolidation. Investments in entities for which the equity method
of accounting is appropriate are reported as financial assets on the balance
sheet. Europay's share of net earnings of these entities is included in the
consolidated statements of income. Investments in entities for which the equity
method is not appropriate are accounted for using historical cost. All
investments are evaluated for impairment on an ongoing basis.

REVENUES

     Revenues are recognized when services are performed. The main operating
revenues arise from the following fees.

     Operations fees -- consists of authorization, clearing and settlement fees
charged to issuers/acquirers based on transaction volumes either through
settlement or through invoices. This also includes fees for other member
services that are collected based on monthly invoices.

     Assessment fees -- consists of assessment fees charged to issuers and
acquirers for costs associated with the overall management of the payments
system, and currency conversion fees charged to issuers, which are charged
daily, monthly and quarterly based on transaction volumes. These fees are
recognized as revenue when collected through direct debit or upon invoicing of
customers. Assessment fees also include card fees charged to issuers that are
recognized as revenue upon invoicing of customers.

     Europay has strategic arrangements with certain members, which provide for
fee rebates when the member meets certain transaction hurdles. Such rebates are
calculated as incurred based upon member transaction levels and the contracted
discount rates for the services provided, and are recorded as a reduction in
revenue in the same period as the revenue is recorded.

FOREIGN CURRENCY TRANSLATION

     The euro (E) is the functional currency for the majority of Europay's
businesses except its Eurocard U.S.A. operations, where the local currency is
the functional currency. Transactions arising from EMU countries in foreign
currencies are translated at their EMU fixed rate. Bank movements generated by
Europay's centralized processing system, known as European Common Clearing &
Settlement System (ECCSS), are translated at the transaction date. All other
transactions arising in foreign currencies are translated to and recorded in
euros at the rate prevailing at the end of the month that precedes the month the
transaction takes place, which is not significantly different from the rate at
the respective transaction date. Current assets and liabilities expressed in
foreign currencies are translated at the spot rate on the balance sheet date.
Profits and losses arising from the translation of foreign currencies are
reflected in the statements of income. For businesses where the local currency
is the functional currency, translation to euros is performed for balance sheet
accounts using current exchange rates in effect at the balance sheet date and
for revenue and expense accounts using an average exchange rate for the period.
Resulting translation adjustments are reported as cumulative translation
adjustments in the consolidated balance sheets.

DEFERRED TAXES

     Deferred tax liabilities on consolidation entries are recorded when it is
probable that a tax charge will effectively be incurred in the foreseeable
future.

INTANGIBLE ASSETS

     Europay has strategic agreements with certain members, which include costs
to obtain the member's commitment to perform under the terms and over the period
of time defined in the agreement. These costs are
                                       F-35
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

capitalized when incurred and amortized over the remaining term of the agreement
using the straight-line method. Eligible direct internal and external costs
related to the application development and testing stages of internally
developed software are capitalized, and, upon completion are amortized using the
straight-line method over a three year estimated useful life. All other
intangible assets, which consist primarily of purchased software, are recorded
at historical cost and amortized over their estimated useful lives using the
straight-line method between three and five years.

PROPERTY, PLANT AND EQUIPMENT

     Land and buildings, plant and equipment, and office furniture and equipment
are recorded at historical cost, including ancillary expenses. Depreciation is
provided on buildings, plant and equipment and office furniture and equipment,
at the following rates calculated to amortize the cost of the assets over their
estimated useful lives, using the straight-line method.

<Table>
<S>                                                           <C>
Buildings...................................................  10 to 33 years
Installations and equipment.................................   5 to 10 years
Office furniture and equipment..............................   5 to 10 years
Other fixed assets..........................................         5 years
Computer hardware...........................................    3 to 4 years
EPSNet computer network.....................................         2 years
Personal computer equipment.................................         3 years
Automobiles.................................................    3 to 4 years
</Table>

     Property, plant and equipment are depreciated for a full year in the year
of acquisition.

PENSIONS

     Europay has a defined benefit pension plan providing retirement and death
benefits to employees, which is funded by a group insurance contract. Premiums
charged by the insurance company are expensed as retirement benefits as
incurred, on the assumption that the amount of the premium constitutes an
appropriate measure of the economic cost of pension obligations for the period.

RESEARCH & DEVELOPMENT

     It is Europay's policy to expense the costs of research and development,
such as chip card research and development, in the year in which they are
incurred.

4. INTANGIBLE ASSETS

<Table>
<Caption>
                                                                  CONCESSIONS,
                                                 SOFTWARE AND       PATENTS,       ADVANCE
                                                   KNOW-HOW      LICENSES, ETC.    PAYMENTS    TOTAL
                                                 ------------    --------------    --------    ------
<S>                                              <C>             <C>               <C>         <C>
ACQUISITION COST
As at December 31, 2000........................     27,114           1,823             --      28,937
Movements during the period:
  Acquisitions, including fixed assets, own
     production................................     10,426           5,030          3,221      18,677
</Table>

                                       F-36
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

<Table>
<Caption>
                                                                  CONCESSIONS,
                                                 SOFTWARE AND       PATENTS,       ADVANCE
                                                   KNOW-HOW      LICENSES, ETC.    PAYMENTS    TOTAL
                                                 ------------    --------------    --------    ------
<S>                                              <C>             <C>               <C>         <C>
  Sales and disposals..........................        (20)             --             --         (20)
  Transfers from one heading to another........     (1,823)             --             --      (1,823)
                                                    ------           -----          -----      ------
As at December 31, 2001........................     35,697           6,853          3,221      45,771
                                                    ------           -----          -----      ------
ACCUMULATED AMORTIZATION AND AMOUNTS WRITTEN
  DOWN
As at December 31, 2000........................     18,289           1,823             --      20,112
Movements during the period:
  Amortization expense.........................      4,776             642             --       5,418
  Written down after sales and disposals.......         (5)             --             --          (5)
  Transfers from one heading to another........     (1,823)             --             --      (1,823)
                                                    ------           -----          -----      ------
As at December 31, 2001........................     21,237           2,465             --      23,702
                                                    ------           -----          -----      ------
NET CARRYING VALUE AT DECEMBER 31, 2001........     14,460           4,388          3,221      22,069
                                                    ======           =====          =====      ======
</Table>

     Europay capitalized work completed on the EMV (Europay, MasterCard, Visa)
integrated circuit card, terminal and card application specifications for
payment systems and related documents as intellectual property for estimated
costs of E269 in 2000 and in doing so recognized income for the same amount,
which is included in the 2000 Consolidated Statement of Income under
capitalization of intangible assets. The EMV intangible assets have been
contributed in their entirety as part of a capital contribution to a joint
venture as described in Note 6 below.

     Starting in 1999 and continuing in 2000 Europay put in place systems and
procedures in order to assess the criteria in respect of capitalization of
internally developed software, which resulted in the effective capitalization of
costs incurred as from January 1, 2000. Capitalized software amounting to E1,192
and related amortization expense of E9 should have been recognized in the
consolidated financial statements for the year ended December 31, 1999. Under
Belgian GAAP it is not permitted to restate opening retained earnings or to
account for this non-capitalization in the following year.

     Europay capitalized internally developed software amounting to E7,737 and
E7,553 in the years ended December 31, 2001 and 2000, respectively. Amortization
expense related to this capitalized software amounted to E2,691 and E602 in 2001
and 2000, respectively.

     Europay capitalized costs amounting to E5,030 and advance payments
amounting to E3,221, which were incurred to obtain members' commitment to
perform under the terms and over the period of time defined in strategic
agreements entered into with the members, in the year ended December 31, 2001.
Amortization related to these capitalized costs amounted to E642 for the year
ended December 31, 2001.

     Computer related assets with an acquisition cost and accumulated
amortization of E1,823 were reclassified to fixed assets (see Note 5).

                                       F-37
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

5. FIXED ASSETS

<Table>
<Caption>
                                         LAND        COMPUTER      FURNITURE    OTHER        ASSETS
                                          AND       EQUIPMENT &       AND      TANGIBLE      UNDER
                                       BUILDINGS   INSTALLATIONS   VEHICLES     ASSETS    CONSTRUCTION   TOTAL
                                       ---------   -------------   ---------   --------   ------------   ------
<S>                                    <C>         <C>             <C>         <C>        <C>            <C>
ACQUISITION COST
As at December 31, 2000..............   39,754         28,017        4,224       8,192          482      80,669
Movements during the period:
  Acquisitions, including fixed
     assets, own construction........    3,624          4,047          266          29          236       8,202
  Sales and disposals................       --         (1,814)         (36)     (5,618)          --      (7,468)
  Transfers from one heading to
     another.........................      482          1,823           --          --         (482)      1,823
                                        ------         ------        -----      ------       ------      ------
As at December 31, 2001..............   43,860         32,073        4,454       2,603          236      83,226
                                        ------         ------        -----      ------       ------      ------
ACCUMULATED DEPRECIATION AND AMOUNTS
  WRITTEN DOWN
As at December 31, 2000..............   15,989         21,628        2,774       6,145           --      46,536
Movements during the period:
  Expense............................    2,880          4,100          620         302           --       7,902
  Written down after sales and
     disposals.......................       --         (1,445)         (18)     (5,618)          --      (7,081)
  Transfers from one heading to
     another.........................       --          1,823           --          --           --       1,823
                                        ------         ------        -----      ------       ------      ------
As at December 31, 2001..............   18,869         26,106        3,376         829           --      49,180
                                        ------         ------        -----      ------       ------      ------
NET CARRYING VALUE AT DECEMBER 31,
  2001...............................   24,991          5,967        1,078       1,774          236      34,046
                                        ======         ======        =====      ======       ======      ======
</Table>

     Computer related assets with an acquisition cost and accumulated
amortization of E1,823 were reclassified from intangible assets (see Note 4).

     Assets under construction in relation to the expansion and renovation of
Europay's Waterloo premises in order to accommodate current and future
organizational and operational requirements amounting to E236 and E482 are
included in the Consolidated Balance Sheets at December 31, 2001 and 2000,
respectively. Assets under construction amounting to E482 and E2,655 were put
into use and as such transferred to buildings during the years ended December
31, 2001 and 2000, respectively.

     In July 1999 Europay sold a building, which it formerly occupied, for a
sales price of E3,718. Europay realized a loss of E124 on the sale.

     Europay rents network computer equipment required for network operations
under an operating lease agreement. The value of the computer equipment rented
under this lease agreement totaled E30,444 and E24,313 at December 31, 2001 and
2000, respectively. Rent expense related to this lease amounted to E4,217,
E4,717 and E5,231 in 2001, 2000 and 1999, respectively.

     During 1999 Europay rented personal computer equipment required for its
activities under operating lease agreements. Rent expense related to these lease
agreements amounted to E1,717 in 1999. In December 1999 Europay bought out the
operating lease agreements. Under the terms of the transaction Europay acquired
personal computer equipment at a cost of E632 and incurred a cancellation fee of
E2,169, which was expensed.

     Europay provides cars to certain levels of management under operating lease
agreements. In 2001 the terms of these operating lease agreements were changed
from 4 to 3 1/2 years. Total expense related to these

                                       F-38
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

lease agreements, including insurance, fuel and maintenance amounted to E2,811,
E2,634 and E2,185 in 2001, 2000 and 1999, respectively.

     Europay also rents office buildings and equipment under operating lease
agreements. Total rents related to these lease agreements amounted to E5,553,
E4,774 and E5,614 in 2001, 2000 and 1999, respectively. Europay provided E422
for the cost of terminating of an operating lease agreement for an office
building, the liability for which is included as part of the provisions for
liabilities and charges in the Consolidated Balance Sheet at December 31, 2001
and the cost is included as part of the net establishment of provisions for
liabilities and charges in the Consolidated Statement of Income for the year
then ended.

     Future scheduled operating lease payments are summarized below. Computer
equipment includes lease payments plus related computer hardware and software
maintenance and service contract costs.

<Table>
<Caption>
                                                                        OFFICE
                                          COMPUTER                    BUILDINGS &
YEAR                                      EQUIPMENT    AUTOMOBILES     EQUIPMENT     TOTAL
----                                      ---------    -----------    -----------    ------
<S>                                       <C>          <C>            <C>            <C>
2002....................................   11,873         1,821          1,630       15,324
2003....................................    7,932         1,238          1,626       10,796
2004....................................      432           672          1,431        2,535
2005....................................       --            68          1,427        1,495
2006 & after............................       --            --          3,356        3,356
                                           ------         -----         ------       ------
          Total.........................   20,237         3,799          9,470       33,506
                                           ======         =====         ======       ======
</Table>

                                       F-39
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

6. FINANCIAL ASSETS

<Table>
<Caption>
                                                                   ENTERPRISES
                                                                    ACCOUNTED
                                                                    FOR USING
                                                                   THE EQUITY
                                                                     METHOD       OTHER     TOTAL
                                                                   -----------    ------    ------
<S>  <C>                                                           <C>            <C>       <C>
1.   INVESTMENTS IN AFFILIATES
     ACQUISITION COST
     As at December 31, 2000.....................................     1,871           --     1,871
     Movements during the period:
       Acquisitions..............................................        --           --        --
       Translation differences...................................        81           --        81
                                                                      -----       ------    ------
     As at December 31, 2001.....................................     1,952           --     1,952
                                                                      -----       ------    ------
     CAPITAL AND RESERVES OF THE ENTERPRISES
     Movements during the period:
       Share in the result for the financial period..............      (239)          --      (239)
       Other movements in the capital and reserves...............       (47)          --       (47)
                                                                      -----       ------    ------
     Net movements during the period.............................      (286)          --      (286)
                                                                      -----       ------    ------
     NET CARRYING VALUE AS AT DECEMBER 31, 2001..................     1,666           --     1,666
                                                                      -----       ------    ------
2.   SECURITY DEPOSITS
     NET CARRYING VALUE AT THE END OF THE YEAR
     As at December 31, 2000.....................................        --          158       158
     Movements during the period:
       Additions.................................................        --          158       158
       Reimbursements............................................        --          (39)      (39)
                                                                      -----       ------    ------
     As at December 31, 2001.....................................        --          277       277
                                                                      -----       ------    ------
     TOTAL.......................................................     1,666          277     1,943
                                                                      =====       ======    ======
</Table>

     Europay has a 33% interest in EMVCo, LLC ("EMVCo"), which it accounts for
on an equity basis. EMVCo was established as a Delaware (U.S.) limited liability
company established as a joint venture under equal ownership by Europay,
MasterCard and Visa to manage, maintain and enhance the EMV Integrated Circuit
Card Specifications for Payment Systems as technology advances and the
implementation of chip card programs become more prevalent. In 2000 Europay's
interest in EMVCo was increased by the contribution of additional intellectual
property valued at E269 (see Note 4).

     Europay also has a 50% interest in a joint venture company, Maestro
International Incorporated. ("Maestro"), of which the remaining 50% interest is
held by MasterCard. At December 31, 1999 the net value of the investment in the
joint venture was nil as the original investment of E184 was fully offset by
loss provisions from previous years.

     In 2000 Europay reversed the loss provision of E184 and recognized a
consolidation adjustment of E383 for the equity share of Maestro's undistributed
1999 net earnings. The reversal of the provision resulted from a change in the
joint venture's profitability. Furthermore, the E383 income from the joint
venture was

                                       F-40
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

recognized subsequent to 1999 or the period earned, and is reflected in the
following required disclosure of consolidation differences:

<Table>
<S>                                                           <C>
Net carrying value at December 31, 2000.....................  383
Movements during the period:
  Adjustment as described above.............................   --
                                                              ---
Net carrying value at December 31, 2001.....................  383
                                                              ===
</Table>

     The Consolidated Balance Sheets include receivables from Maestro of E947
and E345 and payables to Maestro of E2,189 and E1,874 at December 31, 2001 and
2000, respectively. The Consolidated Income Statements include amounts of
E5,773, E4,878 and E4,128 representing Europay's share of the net costs incurred
by Maestro in 2001, 2000 and 1999, respectively.

7. CONSOLIDATED RESERVES

<Table>
<Caption>
                                                              AT DECEMBER 31,
                                                              ----------------
                                                               2001      2000
                                                              ------    ------
<S>                                                           <C>       <C>
Consolidated reserves at beginning of year..................  23,628    14,375
  Movements during the period:
     Net income attributable to the Group...................  12,172     9,253
                                                              ------    ------
  Consolidated reserves at end of year......................  35,800    23,628
                                                              ======    ======
</Table>

8. OTHER AMOUNTS RECEIVABLE

     Other amounts receivable consists of the following.

<Table>
<Caption>
                                                               AT DECEMBER 31,
                                                              -----------------
                                                               2001       2000
                                                              -------    ------
<S>                                                           <C>        <C>
Recoverable VAT.............................................    6,925     5,282
Settlement accounts receivable..............................   99,582    39,303
Income taxes receivable.....................................   22,304     1,314
Other.......................................................      366       720
                                                              -------    ------
          Total other amounts receivable....................  129,177    46,619
                                                              =======    ======
</Table>

     In 2000 a same day settlement service called "Euro D0" for euro-currency
transactions was implemented. This new service results in settlement receivables
and payables arising from the two-day delay in the settlement of issued and
acquired transactions between euro-currency members that settle on a same-day
basis and non-euro currency members that settle two days later. See Note 12 for
Euro D0 settlement payables.

     The income taxes receivable at December 31, 2001 includes a receivable
amounting to E16,878 related to a disputed tax assessment from the Belgian tax
authorities which is further described in Note 16.

9. INVESTMENTS AND DEPOSITS

     Europay had short-term deposits at December 31, 2001 of E6,500 and E2,500
at 3% and 3.4%, respectively, that matured on January 2, 2002.

                                       F-41
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

     At December 31, 2001 Europay had signed forward exchange contracts to hedge
projected U.S. dollar denominated expenses in 2002. Premiums and discounts on
the forward exchange contracts are amortized pro rata from the contract date to
the maturity date.

     The E1,852 investment at December 31, 2000 consists of foreign currency
option premiums paid to cover future cash flows denominated in U.S. dollars.
Option premium payments are recorded as short-term investments whereas option
premiums received are recorded as deferred income.

     At December 31, 2000 Europay made a loss provision for E583 on a written
option for the difference between the strike price of the option and the closing
U.S. dollar exchange rate. This loss provision is included in provisions for
liabilities and charges in the Consolidated Balance Sheet at December 31, 2000
and in net other financial income/(expense) in the Consolidated Statement of
Income for the year then ended. The reversal of this provision upon maturity of
the option in January 2001 is included in net other financial income/(expense)
in the Consolidated Statement of Income for the year December 31, 2001.

     In January 1999 Europay bought a 12-month forward exchange contract for the
purchase of U.S. dollars, which matured in December 1999. A gain of E5,509
realized on this contract is included in net other financial income/(expense) in
the Consolidated Statement of Income for the year ended December 31, 1999.

     The notional and estimated fair values of the outstanding derivative
contracts at December 31, 2001 and 2000 are as follows:

<Table>
<Caption>
                                             AT DECEMBER 31, 2001      AT DECEMBER 31, 2000
                                            ----------------------    ----------------------
                                            NOTIONAL    FAIR VALUE    NOTIONAL    FAIR VALUE
                                            --------    ----------    --------    ----------
<S>                                         <C>         <C>           <C>         <C>
Options:
  Written put U.S. dollar.................       --          --        53,333       2,271
  Written call U.S. dollar................       --          --        18,824          33
  Purchased call U.S. dollar..............       --          --        44,735         359
Forwards:
  Buy U.S. dollar.........................  118,122       4,935            --          --
</Table>

10. CASH AT BANK AND IN HAND AND BANK OVERDRAFTS

     Cash at bank and in hand consists of the following:

<Table>
<Caption>
                                                               AT DECEMBER 31,
                                                              -----------------
                                                               2001      2000
                                                              ------    -------
<S>                                                           <C>       <C>
Cash........................................................  28,341     73,234
Member security deposits....................................  57,619     38,883
                                                              ------    -------
          Total cash at bank and on hand....................  85,960    112,117
                                                              ======    =======
</Table>

     Cash includes E23,226 of cash on Europay's settlement bank accounts from
Euro D0 (described in Note 8 above) and other settlement service operations.

     Europay requires and holds security deposits from certain members in order
to ensure proper settlement of their transactions. The deposits are in euros or
U.S. dollars and are placed on-call at market interest rates. At December 31,
2001 the applicable interest rates were 3.67% on euro deposits and 1.87% on U.S.
dollar deposits. These amounts are fully offset by corresponding liabilities
included in other amounts payable in the Consolidated Balance Sheets (see Note
12). The increase from 2000 to 2001 is primarily due to the addition of new
members in Eastern Europe.

                                       F-42
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

     The bank overdrafts and loans consist of the following:

<Table>
<Caption>
                                                              AT DECEMBER 31,
                                                              ----------------
                                                               2001      2000
                                                              ------    ------
<S>                                                           <C>       <C>
Overdraft on corporate bank accounts........................      36         2
Overdraft on settlement bank accounts.......................  63,582    37,787
                                                              ------    ------
          Total bank overdrafts.............................  63,618    37,789
                                                              ======    ======
</Table>

     The overdraft on settlement bank accounts is due to Euro D0 and other
settlement service operations. Overdrafts on corporate bank accounts are subject
to an interest rate of the Euro OverNight Index Average (Eonia) + 0.5% p.a.

     Europay had two credit lines for a total of E65,000 available at December
31, 2001.

     a) A credit line for operational funding requirements amounting to E35,000
with the following interest rate conditions, which are based on the Euro
Interbank Offered Rate (Euribor):

<Table>
<S>                                                 <C>
Straight loans for periods up to 6 months:          Euribor + 0.0625% p.a.
Straight loans for periods from 6 to 12 months:     Euribor + 0.125%
</Table>

     b) A credit line amounting to E30,000 to provide fixed term financing to
fund Euro D0 settlement service operations. Interest rate conditions are agreed
with the bank based on the most favorable market conditions at the time the
credit line is utilized.

     Europay had no borrowings on these credit lines at December 31, 2001 or
December 31, 2000.

11. MINORITY INTEREST

     MasterCard has a 15% shareholding in European Payment Systems Services
("EPSS"), Europay's transaction processing subsidiary, for which a minority
interest in Europay is determined as follows:

<Table>
<Caption>
                                                              AT DECEMBER 31,
                                                              ----------------
                                                               2001      2000
                                                              ------    ------
<S>                                                           <C>       <C>
15% interest in the capital of EPSS.........................  1,562     1,562
Minority share in the profits of EPSS
  Accumulated results.......................................  1,057       804
  Result for the year.......................................    441       253
                                                              -----     -----
Total minority interest.....................................  3,060     2,619
                                                              =====     =====
</Table>

12. OTHER AMOUNTS PAYABLE

     Other amounts payable consists of the following.

<Table>
<Caption>
                                                              AT DECEMBER 31,
                                                              ----------------
                                                               2001      2000
                                                              ------    ------
<S>                                                           <C>       <C>
Settlement accounts payable, see note 8.....................  24,434    47,577
Liability for member security deposits, see note 10.........  57,619    38,883
Loans from Members..........................................      --     2,533
Other.......................................................     865       756
                                                              ------    ------
          Total other amounts payable.......................  82,918    89,749
                                                              ======    ======
</Table>

                                       F-43
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

13. LONG TERM LIABILITIES

     The balance of E506 at December 31, 2001 represents an invoice for a
sponsorship campaign that is payable in 2003, and the balance of E244 at
December 31, 2000 represents an invoice for a sponsorship campaign that is
payable in 2002.

14. COMMITMENTS AND CONTINGENCIES

     In addition to the future lease payments summarized in Note 5, Europay has
entered into sponsorship and marketing contractual obligations, which are
estimated to be payable in the following years:

<Table>
<Caption>
YEAR
----
<S>                                                           <C>
2002........................................................  25,342
2003........................................................  12,056
2004........................................................   1,273
2005........................................................     123
2006 & after................................................     123
                                                              ------
          Total.............................................  38,917
                                                              ======
</Table>

     Europay received a claim from a member alleging that an error in the
technical set up of this member caused the member to incur a loss in revenues
amounting to approximately E1,500. Based on the facts and circumstances of this
matter Europay has established a provision for the potential settlement of the
claim of E739, which is included in suppliers in the Consolidated Balance Sheet
at December 31, 2001 and in other operating expenses in the Consolidated
Statement of Income for the year then ended.

15. AVERAGE NUMBER OF PERSONS EMPLOYED AND PERSONNEL CHARGES

<Table>
<Caption>
                                                           YEARS ENDED DECEMBER 31,
                                                     ------------------------------------
                                                      2001        2000           1999
                                                     ------    -----------    -----------
                                                                              (UNAUDITED)
<S>                                                  <C>       <C>            <C>
PERSONNEL BY CATEGORY
Employees:
  Based in Belgium.................................     542         560            526
  Based outside of Belgium.........................      88          87            102
                                                     ------      ------         ------
Total employees....................................     630         647            628
Management personnel...............................       8           8              8
                                                     ------      ------         ------
  Average number of persons employed...............     638         655            636
                                                     ======      ======         ======
REMUNERATION, SOCIAL SECURITY AND PENSIONS.........  63,991      58,902         50,741
                                                     ======      ======         ======
</Table>

     Management personnel consist of the directors of Europay and all other
staff are included in the employees category.

     In 2000 Europay provided E1,479 for obligations arising from severance
agreements with employees, of which E127 is included in operating expenses and
E1,353 is included in extraordinary income/(charges) in the Consolidated
Statement of Income for the year ended December 31, 2000. The liability for
these obligations is included as part of the provisions for liabilities and
charges in the Consolidated Balance Sheet at December 31, 2000. These
obligations were settled in 2001 resulting in a use of provisions for
liabilities and charges amounting to E1,353 and a charge to operating expenses
for the same amount in the Consolidated Statement of Income for the year ended
December 31, 2001.

                                       F-44
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

     In 2001, Europay introduced a performance-based variable pay program for
all management and staff. Under this program a bonus is paid to an employee on
an annual basis based on the level of achievement of targeted corporate and
personal performance for the year. Europay monitors performance to corporate
targets on a regular basis and accrues for the cost of the variable pay program
when it is probable that the targets will be reached. Based on the 2001
corporate performance evaluation variable pay costs of E5,461 were accrued at
December 31, 2001.

     In 2001, Europay established and began executing a comprehensive
restructuring plan in order to prepare the organization and operations for the
planned integration with MasterCard Incorporated described in Note 18 below. The
plan provides for the involuntary termination of staff functions on specified
dates over the term of the plan. Europay agreed an involuntary employee
severance package for the plan with its Works Council, and communicated the
package to all staff. In 2001, Europay notified all staff whose function will be
terminated prior to the end of 2002 in writing that their position will be
terminated as a result of the plan, including the expected termination date.
Based on the terms of the involuntary employee severance package and a
probability analysis of staff terminations defined in the plan to the end of
2002, Europay provided E2,742 for estimated involuntary employee severance
costs. In addition, Europay provided E275 for obligations arising from separate
severance agreements with employees. The liabilities for both severance
provisions are included as part of the provisions for liabilities and charges in
the Consolidated Balance Sheet at December 31, 2001 and the costs are included
in extraordinary income/(charges) in the Consolidated Statement of Income for
the year then ended.

16. TAXATION

     The reconciliation of the 2001, 2000 and 1999 income tax charges compared
to the statutory rate of 40.17% is as follows:

<Table>
<Caption>
                                                           YEARS ENDED DECEMBER 31,
                                                     ------------------------------------
                                                      2001        2000           1999
                                                     ------    -----------    -----------
                                                                              (UNAUDITED)
<S>                                                  <C>       <C>            <C>
Consolidated profit for year before taxation.......  23,586      17,111         14,616
                                                     ======      ======         ======
Taxes at statutory rate of 40.17%..................   9,474       6,873          5,871
Adjusted for the tax effect of:
  Disallowed expenses..............................     925         656            735
  Penalties for insufficient tax prepayments.......      --           1            115
  Non-taxable reversal of investment loss
     provision.....................................      --         (74)            --
  Non-taxable (profit)/loss in consolidated
     subsidiary....................................      (5)          5             --
  Tax adjustments..................................     340         (13)            --
  Tax surplus for prior years......................      --          (1)            --
                                                     ------      ------         ------
Tax charge for the year............................  10,734       7,447          6,721
                                                     ======      ======         ======
Effective tax rate.................................    45.5%       43.5%          46.0%
                                                     ======      ======         ======
</Table>

     Included in the consolidated tax charge for the years ended December 31,
2001 and 2000 is deferred tax amounting to E2,025 and E2,792, respectively,
related to the capitalization of internally developed software, net of related
amortization expense for the year.

     In April 1999, the Belgian tax authorities initiated an investigation of
Europay's tax returns for 1997 and 1998. In June 2001, Europay received a notice
from the Belgian tax authorities challenging Europay's deduction of certain
card-based incentive program costs. Although Europay challenged these findings
in its August 2001 response to the notice, the Belgian tax authorities
reaffirmed their position in a November 2001 letter to Europay and, on December
12, 2001, Europay received a formal notice of assessment imposing an

                                       F-45
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

additional tax liability of E16,878, including penalties and interest, in
connection with Europay's tax returns for 1997 and 1998. In accordance with
Belgian GAAP Europay recorded a tax liability for E16,878 upon receipt of the
assessment notice, which is included in taxes in the Consolidated Balance Sheet
at December 31, 2001.

     Europay intends to continue to vigorously contest this matter and on
February 27, 2002 filed a protest with the regional tax director in accordance
with applicable administrative tax procedures. Therefore, in accordance with
Belgian GAAP a receivable of E16,878 has been recorded to reflect the amount in
dispute. This receivable is included in other amounts receivable in the
Consolidated Balance Sheet at December 31, 2001.


     If Europay's deductions of such costs in 1999, 2000 and 2001 are similarly
challenged, this could result in a further additional tax liability of up to
approximately E16,900, including possible penalties. Interest will accrue on any
additional amounts to be paid at a per annum rate of 7% until settlement.
Interest on additional amounts will begin to accrue on July 1 of the second
fiscal year following the fiscal year in which the deductions to which the
additional amount relates was made.


     In the event that Europay is unsuccessful in appealing the findings to the
Belgian tax authorities in their investigation, under certain circumstances
MasterCard International could, under its bylaws, levy an assessment on its
European members for the additional tax liability to the extent that it,
together with other losses and liabilities arising out of the representations
and warranties of Europay in the draft integration agreement, exceeds $7 million
in the aggregate.

17. ALLIANCE AGREEMENT WITH MASTERCARD INTERNATIONAL INCORPORATED

     On November 14, 1996, Europay entered into an Alliance Agreement with
MasterCard pursuant to which Europay has been granted exclusive licensing rights
for the MasterCard brand in Europe and is responsible for the overall management
of the MasterCard brand within the European region. In accordance with this
agreement:

     (a) Europay took over from MasterCard the billing of European members for
inter-regional credit program and service transactions as from January 1, 1998
and for inter-regional debit program and service transactions as from January 1,
1999. The Consolidated Statements of Income include revenues generated from
these transactions amounting to E126,878, E126,606 and E111,925 in 2001, 2000
and 1999, respectively.

     (b) Europay is responsible for funding MasterCard's Europe region costs
plus an agreed profit margin. Total MasterCard Europe region charges of
E123,460, E103,868 and E83,172 in 2001, 2000 and 1999, respectively, are
included in services and other goods.

     (c) European members were required to migrate to a new Eurocard/MasterCard
acceptance brand over the three-year period from 1997 to 1999, and MasterCard
compensated the European members for their brand migration efforts through a
Country Migration Fund over the same time period. Europay incurred E4,558 in
advertising and marketing costs related to European members' brand migration
activities in 1999. These costs are included in services and other goods in the
1999 Consolidated Statement of Income. Europay re-billed MasterCard and recorded
related revenues for the full amount of these costs.

     The Consolidated Balance Sheets include receivables from MasterCard of E573
and E2,401 and payables to MasterCard of E4,131 and E11,955 at December 31, 2001
and 2000, respectively.

18. PROPOSED INTEGRATION WITH MASTERCARD INCORPORATED

     Europay's shareholders are considering entering into an integration
agreement with MasterCard Incorporated and MasterCard International that
provides for MasterCard Incorporated to acquire all of Europay's capital stock
in exchange for class A and class B common stock of MasterCard Incorporated (the
"integration").

                                       F-46
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

     The integration is conditioned upon the merger of MasterCard International
with a subsidiary of MasterCard Incorporated and the exchange of existing
principal and association memberships in MasterCard International for new class
A membership interests in MasterCard International and shares of class A and
class B common stock of MasterCard Incorporated (the "conversion"), the approval
of Europay's shareholders, and other customary closing conditions. Upon
completion of the conversion and integration, the European principal members of
MasterCard International will own 33 1/3% of the outstanding capital stock of
MasterCard Incorporated and the non-European members will own 66 2/3%.

     Following the completion of the conversion and integration, the Alliance
Agreement between Europay and MasterCard described in Note 17 above will be
terminated.

     As of April 17, 2002 the conversion and integration have not occurred.

19. SUMMARY OF DIFFERENCES BETWEEN BELGIUM AND UNITED STATES GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES

     The accompanying consolidated financial statements have been prepared in
accordance with Belgian GAAP, which differ in certain material respects from
accounting principles generally accepted in the United States of America ("U.S.
GAAP"). These differences involve methods for measuring the amounts shown in the
financial statements, as well as additional disclosures required by U.S. GAAP.

U.S. GAAP RECONCILING ITEMS TO CONSOLIDATED NET INCOME AND TOTAL SHAREHOLDERS'
EQUITY.

     The following is a summary of the material adjustments to profit on
ordinary activities after taxation and shareholders' equity that would have been
required in applying the significant differences between Belgian and U.S. GAAP.

                                       F-47
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

            RECONCILIATION OF CONSOLIDATED PROFIT AND LOSS ACCOUNTS
                   (IN E THOUSANDS EXCEPT EARNINGS PER SHARE)

<Table>
<Caption>
                                                              YEARS ENDED DECEMBER 31,
                                                              -------------------------
                                                              NOTES     2001      2000
                                                              -----    ------    ------
<S>                                                           <C>      <C>       <C>
Net Income Attributable to the Group as reported under
  Belgian GAAP..............................................           12,172     9,253
U.S. GAAP adjustments:
  Pensions..................................................   (a)        395      (558)
  Capitalization of borrowing costs, net....................   (c)        (52)      (35)
  Depreciation of fixed assets..............................   (d)       (672)      508
  Internally developed software costs, net..................   (e)       (391)     (227)
  Financial instruments.....................................   (f)      2,445    (1,600)
  Leases, net...............................................   (g)        526       691
  Capitalization of intangible assets.......................   (h)        465       513
  Financial assets..........................................   (i)         --       255
  Licensing fee revenue recognition.........................   (j)       (818)     (845)
                                                                       ------    ------
Net U.S. GAAP adjustments before deferred taxes.............            1,898    (1,298)
  Deferred taxes: effects of differences in methodology and
     adjustments............................................   (b)       (596)      802
                                                                       ------    ------
Net income under U.S. GAAP before cumulative effect of
  change in accounting principle............................           13,474     8,757
Cumulative effect of changes in accounting principle, net of
  tax
  Financial instruments.....................................   (f)       (547)       --
  Licensing fee revenue recognition.........................   (j)         --    (3,100)
                                                                       ------    ------
Total cumulative effect of changes in accounting principle,
  net of tax................................................             (547)   (3,100)
                                                                       ------    ------
Net Income Attributable to the Group under U.S. GAAP........           12,927     5,657
                                                                       ======    ======
Earnings per share in accordance with U.S. GAAP:............   (k)
  Basic and diluted.........................................              129        57
Weighted average number of shares outstanding (in thousands
  of shares):
  Basic and diluted.........................................              100       100

Net income per U.S. GAAP....................................           12,927     5,657
Other Comprehensive income, net of tax:
  Financial instruments.....................................   (f)      5,058        --
  Translation adjustment....................................                9        15
                                                                       ------    ------
  Total other comprehensive income..........................            5,067        15
                                                                       ------    ------
Comprehensive income under U.S. GAAP........................   (l)     17,994     5,672
                                                                       ======    ======
</Table>

                                       F-48
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

              RECONCILIATION OF CONSOLIDATED SHAREHOLDER'S EQUITY

<Table>
<Caption>
                                                                   AT DECEMBER 31,
                                                              -------------------------
                                                              NOTES     2001      2000
                                                              -----    ------    ------
<S>                                                           <C>      <C>       <C>
Total shareholders' equity reported under Belgian GAAP......           54,062    41,857
U.S. GAAP adjustments:
  Pensions..................................................   (a)        692       297
  Deferred taxes............................................   (b)     (5,292)   (4,696)
  Capitalization of borrowing costs, net....................   (c)      2,362     2,414
  Depreciation of fixed assets..............................   (d)      5,896     6,568
  Internally developed software costs, net..................   (e)        565       956
  Financial instruments.....................................   (f)      5,903    (1,600)
  Leases, net...............................................   (g)      4,356     3,830
  Capitalization of intangible assets.......................   (h)       (126)     (567)
  Financial assets..........................................   (i)       (184)     (184)
  Licensing fee revenue recognition.........................   (j)     (1,663)     (845)
                                                                       ------    ------
Net U.S. GAAP adjustments before cumulative effect of
  changes in accounting principle...........................           12,509     6,173
                                                                       ------    ------
Shareholders' equity under U.S. GAAP before cumulative
  effect of changes in accounting principle.................           66,571    48,030
Cumulative effect of changes in accounting principle, net of
  tax
  Financial instruments.....................................   (f)       (547)       --
  Licensing fee revenue recognition.........................   (j)     (3,100)   (3,100)
Total cumulative effect of changes in accounting principle,
  net of tax................................................
                                                                       ------    ------
Shareholders' equity under U.S. GAAP........................           62,924    44,930
                                                                       ======    ======
</Table>

         MOVEMENTS IN SHAREHOLDERS' EQUITY IN ACCORDANCE WITH U.S. GAAP

<Table>
<Caption>
                                                                       AT DECEMBER 31,
                                                                       ----------------
                                                                        2001      2000
                                                                       ------    ------
<S>                                                           <C>      <C>       <C>
Balance, beginning of year..................................           44,930    39,258
Net income..................................................           12,927     5,657
Other comprehensive income:
  Financial instruments.....................................   (f)      5,058        --
  Translation adjustment....................................                9        15
                                                                       ------    ------
  Total other comprehensive income..........................            5,067        15
                                                                       ------    ------
Balance, end of year........................................           62,924    44,930
                                                                       ======    ======
</Table>

     A summary of the principal differences and additional disclosures
applicable to Europay are set out below:

  (a) Pensions

     Under Belgian GAAP, enterprises are required to make provision for their
obligations relating to retirement or survivors' pensions, early-retirement and
other similar pensions or allowances. However, enterprises are also bound by law
to fund their pension obligations with an independent pension fund or insurance
company. Consequently, the practice in Belgium is to expense as incurred the
premium charged by the insurance company or pension fund, on the assumption that
the amount of the premium constitutes an appropriate measure of the economic
cost of their pension obligations for the period concerned.

                                       F-49
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

     Under U.S. GAAP, the annual pension cost comprises the estimated cost of
benefits accruing in the period as determined in accordance with Statement of
Financial Accounting Standards (SFAS) No. 87, which requires readjustment of the
significant actuarial assumptions annually to reflect current market and
economic conditions. Under SFAS No. 87, a pension asset representing the excess
plan assets over benefit obligations is recognized in the balance sheet. The
pension benefit obligation is calculated by using a projected unit credit
method. Actuarial gains or losses within a 10% "corridor" are recognized. In
addition, in cases where the accumulated benefit obligation exceeds the
unamortized prior service cost, Europay has recorded the excess as a separate
component of shareholders' equity.

     The net periodic pension cost under U.S. GAAP for Europay's defined benefit
pension plan is as follows:

                     COMPONENTS OF NET PERIOD BENEFIT COST

<Table>
<Caption>
                                                               YEARS ENDED
                                                               DECEMBER 31,
                                                              --------------
                                                              2001     2000
                                                              -----    -----
<S>                                                           <C>      <C>
Service cost................................................  1,971    1,963
Interest cost...............................................    569      482
Expected return on plan assets..............................   (605)    (551)
Amortization of transition obligation.......................    117      117
Amortization of net (gain)/loss.............................   (143)    (179)
Amortization of prior service cost..........................     92       92
                                                              -----    -----
Net periodic benefit cost...................................  2,001    1,924
                                                              =====    =====
</Table>

     Changes in the projected benefit obligation and plan assets during the year
were as follows:

                    CHANGES IN PROJECTED BENEFIT OBLIGATION

<Table>
<Caption>
                                                                YEARS ENDED
                                                                DECEMBER 31,
                                                              ----------------
                                                               2001      2000
                                                              ------    ------
<S>                                                           <C>       <C>
Benefit obligation at beginning of year.....................  10,914     9,228
Service cost................................................   1,971     1,963
Interest cost...............................................     569       482
Actuarial (gains)/losses....................................     415       205
Benefits paid...............................................    (943)     (964)
                                                              ------    ------
Benefit obligation at end of year...........................  12,926    10,914
                                                              ======    ======
</Table>

                             CHANGES IN PLAN ASSETS

<Table>
<Caption>
                                                                YEARS ENDED
                                                                DECEMBER 31,
                                                              ----------------
                                                               2001      2000
                                                              ------    ------
<S>                                                           <C>       <C>
Fair value of plan assets at beginning year.................  11,597    10,437
Actual return on plan assets................................     527       758
Employer contributions......................................   2,395     1,366
Benefits paid...............................................    (943)     (964)
                                                              ------    ------
Fair value of plan assets, end of year......................  13,576    11,597
                                                              ======    ======
</Table>

                                       F-50
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

     The funded status under U.S. GAAP for Europay's defined benefit pension
plan is as follows:

                                 FUNDED STATUS

<Table>
<Caption>
                                                                 YEARS ENDED
                                                                 DECEMBER 31,
                                                              ------------------
                                                               2001       2000
                                                              -------    -------
<S>                                                           <C>        <C>
Fair value of plan assets...................................   13,576     11,597
Projected benefit obligation................................  (12,926)   (10,914)
                                                              -------    -------
Funded status...............................................      650        683
Unrecognized net actuarial (gain) loss......................   (1,704)    (2,342)
Unrecognized prior service cost.............................      418        510
Unrecognized transition amount..............................    1,328      1,446
                                                              -------    -------
Prepaid (accrued) benefit cost..............................      692        297
                                                              =======    =======
</Table>

     The weighted-average assumptions used to determine pension cost for
Europay's defined benefit pension plan were as follows:

<Table>
<Caption>
                                                               YEARS ENDED
                                                              DECEMBER 31,
                                                              -------------
                                                              2001     2000
                                                              ----     ----
<S>                                                           <C>      <C>
Discount rate...............................................  5.25%    5.50%
Expected rate of return on plan assets: on financing
  funds.....................................................  5.25%    5.50%
Expected rate of return on plan assets: on mathematical
  reserves..................................................  4.75%    4.75%
Expected rate of compensation increase......................  4.25%    4.50%
                                                              ====     ====
</Table>

  (b) Deferred Tax

     Under Belgian GAAP, deferred tax liabilities on consolidation entries
should be recorded when it is probable that a tax charge will effectively be
incurred in the foreseeable future.

     Under U.S. GAAP, deferred tax is provided for on a full liability basis.
Under the full liability method, deferred tax assets or liabilities are
recognized for differences between the financial and tax basis of assets and
liabilities and for tax loss carry forwards at the statutory rate at each
reporting date. A valuation allowance is established when it is more likely than
not that some portion or all of the deferred tax assets will not be realized.

  (c) Capitalization of Borrowing Costs

     Under Belgian GAAP, an entity may choose between capitalizing or not
capitalizing interest on specific borrowings to finance the construction of
individual qualifying assets. Europay does not capitalize interest cost as part
of the historical cost of its qualifying construction projects.

     Under U.S. GAAP, interest recognized on borrowings and other obligations
must be capitalized for assets that are produced under a discrete project and
require a substantial period of time to get ready for their intended use or
sale. The amount of interest eligible for capitalization is determined as either
the actual cost incurred on a specific borrowing or the weighted average of the
rates applicable for all the general borrowings outstanding during the period.
The total amount of interest cost capitalized in each period is limited to the
total amount of interest cost incurred in that period.

     The adjustment to net income under U.S. GAAP reflects the decrease in
interest expense for the period as well as the increase in depreciation expense
on the constructed assets. The adjustment to shareholders' equity under U.S.
GAAP reflects the amount of interest capitalized on constructed assets, net of
depreciation.

                                       F-51
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

  (d) Depreciation of Fixed Assets

     Under Belgian GAAP, Europay depreciates its fixed assets for a full year in
the year of acquisition under the straight-line basis. Further, Europay may
depreciate an asset during the period of its construction or development
regardless of whether the asset is substantially ready for its intended use.
Prior to 1999 Europay depreciated assets during the period of construction
regardless of when the asset was substantially ready for its intended use.

     Under U.S. GAAP, fixed assets are depreciated from the date of acquisition
on a straight-line basis. Constructed assets are depreciated on a straight-line
basis when substantially complete. For purposes of the U.S. GAAP reconciliation,
Europay has applied the half-year convention method whereby a half-year of
depreciation is taken in the year of acquisition and in the year of disposal.
Additionally, a constructed asset is depreciated when it is substantially ready
for its intended use.

  (e) Internally Developed Software Costs

     Under Belgian GAAP, costs relating to internally developed software are
capitalized when it can be demonstrated that:

     - The product or process is useful;

     - The product or process is clearly defined;

     - Costs related to the project are clearly identified,

     - The project is technically feasible; and

     - Financial resources are available to complete the project.

     Under U.S. GAAP, certain costs to develop or obtain internal-use software
should be capitalized when the preliminary project stage is completed,
management implicitly or explicitly authorizes and commits to funding a computer
software project and it is probable that the project will be completed. Costs of
computer software developed or obtained for internal use that can be capitalized
include external direct material and service costs, payroll and payroll-related
costs for employees who devote time to the internal-use computer software
project and interest costs incurred while developing internal-use computer
software. Capitalized costs are amortized under a straight-line basis over the
expected useful life of the software.

  (f) Financial Instruments

     Under Belgian GAAP, premiums paid and received on option contracts intended
to reduce (hedge) foreign exchange risk on future U.S. dollar payments are
deferred. Option contracts that do not qualify as risk reducing (non-hedge) are
accounted for using the lower of cost or market approach.

     Under U.S. GAAP, gains and losses related to derivative instruments that
satisfy the criteria for hedge accounting are recognized in the same period as
gains and losses on the hedged item. Upon termination of the derivative, any
gains and losses are deferred and amortized to profit and loss over the
remaining life of the hedged item. Derivatives that do not qualify for hedge
accounting are recorded on the balance sheet at fair value with gains and losses
immediately included in earnings.

     The adjustment to net income under U.S. GAAP reflects the fact that certain
contracts accounted for by Europay as hedges do not meet the criteria for hedge
accounting under U.S. GAAP. In addition, premiums paid for hedge contracts are
carried at cost by Europay, whereas they are amortized over the life of the
derivative contract under U.S. GAAP.

     On January 1, 2001 Europay adopted hedge accounting under Statement of
Financial Accounting Standards (SFAS) No. 133. Under SFAS No. 133 Europay is
required to recognize all derivatives in the consolidated balance sheet by
measuring these derivatives at fair value. The recognition of the change in the

                                       F-52
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

fair value of a derivative depends on a number of factors, including the
intended use of the derivative and the extent to which it is effective as part
of a hedge transaction.

     Europay recorded a cumulative effect adjustment of E547 (loss) to net
income and shareholders' equity under U.S. GAAP for the year ended December 31,
2001 to recognize at fair value all derivative instruments that were designated
as cash flow hedging instruments upon adoption of SFAS 133.

     As discussed in Note 9, Europay had entered into forward currency hedge
contracts at December 31, 2001. Under Belgian GAAP, premiums or discounts are
amortized over the life of the contract. Under U.S. GAAP, the effective portion
of the gain or loss of the derivative instrument is recorded as a component of
other comprehensive income whereas the non-effective portion of the gain or loss
is recognized currently in earnings. For the year ended December 31, 2001,
E5,058 has been recorded as other comprehensive income for the effective portion
of the contracts.

  (g) Leases

     Under Belgian GAAP, a capital lease is deemed to exist when the sum of the
minimum lease payments is equal to or greater than the lessor's investment in
the leased asset, including related interest and other transaction costs.

     Under U.S. GAAP, a capital lease is deemed to exist when any of the
following criteria are met:

     - The present value of the minimum lease payments is greater than or equal
      to 90% of the fair value of the asset at the inception of the lease, or

     - The length of the lease period is greater than or equal to 75% of the
      asset's estimated useful economic life, or

     - The transfer of ownership of the asset to the lessee by the end of the
      lease term, or

     - The existence of a bargain purchase option.

     The adjustment to net income under U.S. GAAP reflects a decrease in rental
expense and an increase in depreciation expense related to the capitalized
leased assets. The adjustment to shareholders' equity under U.S. GAAP reflects
the capitalization of the net present value of the minimum lease payments using
the interest rate implicit in the lease.

     During the third quarter of 2001, the Company revised its lease term for
all existing automobile contracts from 4 years to 3 1/2 years with its leasing
company. Under U.S. GAAP, this modification of the lease terms effectively
terminated the existing capital lease agreements. As such, any assets and
liabilities will need to be removed from the balance sheet and an appropriate
gain or loss will be charged to profit and loss. As a result of this change in
accounting estimate, capital lease assets under U.S. GAAP with a net book value
of E1,129 and a total capital lease obligation of E1,156 were removed from the
balance sheet and a gain of E27 was recorded in the third quarter of 2001. Going
forward, under the new lease term, the existing leases have been recorded as
operating leases.

  (h) Capitalization of Intangible Assets

     Europay recognized the initial contributions to a joint venture at fair
value of the assets contributed. As such, any contribution of "know-how" is
recognized at fair value by both Europay and the joint venture. Further, Europay
recognizes its proportionate share of expenses associated with the amortization
of "know-how" recorded by the joint venture. See Note 4 for additional
information.

     Under U.S. GAAP, initial contributions to a joint venture should generally
be recorded at cost, i.e., the amount of cash contributed or net book value of
non-cash assets contributed.

                                       F-53
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

  (i) Financial Assets

     Under Belgian GAAP, Europay recorded a loss in value of an investment
accounted for under the equity method. Losses must be subsequently reversed.
Dividends to be received from an equity investee are accrued as income when
declared. See Note 4 for additional information.

     Under U.S. GAAP, a loss in value of an investment, accounted for under the
equity method, which is other than temporary should be recognized. Recognized
losses are not subsequently reversed based on subsequent events or economic
developments. Dividends from an investee accounted for under the equity method
are recognized when declared as a reduction in the carrying amount of the
investment. Europay's share of earnings or losses from equity investees is
recognized as an adjustment to the carrying amount of the investment.

  (j) Licensing Fee Revenue Recognition

     Under Belgian GAAP, revenue from licensing fees is recognized immediately
upon invoicing of customers.

     Under U.S. GAAP, licensing fees are earned as services are delivered and
performed over the term of the arrangement or the expected period of performance
and generally should be deferred and recognized systematically over the periods
that the fees are earned.

     The adjustment to net income and shareholders' equity under U.S. GAAP
reflects the deferral and recognition of licensing revenue over the life of the
licensing arrangement for the current year.

     The cumulative effect adjustment to net income and shareholders' equity
under U.S. GAAP reflects the cumulative adjustment, net of tax effects, related
to the deferral and proportionate recognition of licensing revenue upon adoption
of SAB 101.

  (k) Earnings Per Share

     Belgian GAAP does not require the presentation of earnings per share (EPS).

     Under U.S. GAAP, basic and diluted earnings per share must be disclosed for
companies that file public reports under U.S. federal securities laws. Basic EPS
is calculated as profit available to common shareholders, divided by the
weighted average number of shares in issue during the period. Shares issued as a
result of a bonus issue are treated as if in issue for the whole year. To
calculate diluted EPS, earnings are adjusted for the after-tax amount of
dividends and interest recognized in the period in respect of the dilutive
potential ordinary shares and for any other changes in income or expense that
would result from the conversion of the dilutive potential on ordinary shares
and for any other changes in income or expense that would result from the
conversion of the dilutive potential ordinary shares. The conversion is deemed
to have occurred at the beginning of the period or, if later, the date of the
issue of potential ordinary shares.

  (l) Comprehensive Income

     Belgian GAAP does not require the presentation of comprehensive income.

     U.S. GAAP requires disclosure of the components of total comprehensive
income in the period in which they are recognized in the financial statements.
Comprehensive income is defined as the change in equity (net assets) of a
business enterprise arising from transactions and other events and circumstances
from non-owner sources. It includes all changes in shareholders' equity during
the reporting period except those resulting from investments by owners and
distributions to owners.

Revenue Recognition

     Under Belgian GAAP, revenue earned and related cost of sales incurred while
acting as an agent may be presented on a gross basis in the statement of income.

                                       F-54
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

     Under U.S. GAAP, revenue and related cost of sales should be presented
gross if Europay acts as a principal in the transactions and has the risk and
rewards of ownership. Europay acts as an agent on behalf of MasterCard
International for the billing and collection of inter-regional transactions with
members. Europay does not bear the risk and rewards of ownership related to
these transactions and therefore revenue and related costs should be reported
net under U.S. GAAP. The impact would be a reduction in revenue of E126,878 and
E126,606, net of a reduction in MasterCard costs included in services and other
goods of E123,460 and E103,868 for the years ended December 31, 2001 and 2000,
respectively.

Extraordinary Items

     Items classified as extraordinary under Belgian GAAP do not meet the
definition of "extraordinary" under U.S. GAAP and, accordingly, are classified
as operating expenses under U.S. GAAP.

Cash Flow Information

     Under Belgian GAAP, a presentation of cash flows is considered voluntary.
The statement of cash flows presented in the financial statements has been
prepared in accordance with IAS 7. This presentation is acceptable under Belgian
GAAP.

     Under U.S. GAAP a statement of cash flows is required to be present in
accordance with SFAS No. 95. Interest paid and received and dividends received
are shown as operating activity cash flows, while dividends paid are shown as
financing cash flows.

     A summary of Europay's operating, investing and financing activities,
classified in accordance with U.S. GAAP is as follows:

<Table>
<Caption>
                                                                  YEAR ENDED
                                                                 DECEMBER 31,
                                                              ------------------
                                                               2001       2000
                                                              -------    -------
<S>                                                           <C>        <C>
Net cash provided by/(used in) operating activities.........  (11,414)    65,234
Net cash used in investing activities.......................  (40,195)   (22,321)
Net cash provided by financing activities...................   25,452     35,960
                                                              -------    -------
Net increase/(decrease) in cash and cash equivalents........  (26,157)    78,873
Cash and cash equivalents under U.S. GAAP, beginning of
  year......................................................  112,117     33,244
                                                              -------    -------
Cash and cash equivalents under U.S. GAAP, end of year......   85,960    112,117
                                                              =======    =======
</Table>

Recently Issued Accounting Standards

of the United States

     SFAS No. 141, "Business Combinations" ("SFAS 141"), and SFAS No. 142,
"Goodwill and Other Intangible Assets" ("SFAS 142") were issued in July 2001.
SFAS 141 and SFAS 142 will be required to be implemented for accounting periods
commencing as from July 1, 2001 and January 1, 2002, respectively. SFAS 141
requires that all business combinations be accounted for by the purchase method.
SFAS 142 addresses the accounting for acquired goodwill and other intangible
assets and contains certain transitional provisions, which may affect
classification of intangible assets, as well as the balance of goodwill. The
ongoing impact will be that goodwill will no longer be amortized, but instead
will be tested at least annually for impairment. The requirements of both
statements will be applied prospectively from the effective date. Europay has
assessed the impact of this new standard at January 1, 2002 and there is no
impact on its financial position and results of operations. SFAS 143, "Asset
Retirement Obligations", was issued in June 2001. This standard will be
effective for Europay's fiscal year beginning after June 15, 2002; however,
early adoption is permitted. The standard provides the accounting requirements
for retirement obligations associated with tangible long-lived assets and the
associated asset retirement cost. The standard requires that the obligation

                                       F-55
<PAGE>
                           EUROPAY INTERNATIONAL S.A.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
                                (IN E THOUSANDS)

associated with the retirement of the tangible long-lived assets be capitalized
into the asset cost at the time of initial recognition. The liability is then
discounted to its fair value at the time of recognition using the guidance
provided by the standard. Europay is assessing the impact that this new standard
will have on its financial position and results of operations.

     In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." SFAS No. 144 addresses financial
accounting and reporting for the impairment or disposal of long-lived assets.
This statement supersedes SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of," and the
accounting and reporting provisions of APB No. 30, "Reporting the Results of
Operations." This statement also amends Accounting Research Bulletin No. 51,
"Consolidated Financial Statements," to eliminate the exception to consolidation
for a subsidiary for which control is likely to be temporary. SFAS 144 is
effective for financial statements issued for fiscal years beginning after
December 15, 2001, and interim periods within those fiscal years. Europay is in
the process of determining the effects of this statement on its business.

                                       F-56

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.4
<SEQUENCE>8
<FILENAME>y62026exv99w4.txt
<DESCRIPTION>UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
<TEXT>
<PAGE>

               UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

     The following unaudited pro forma condensed combined financial statements
combine the historical consolidated balance sheets and statements of income of
MasterCard International and Europay and give pro forma effect to the conversion
and integration.

     We are providing the following information to aid you in your analysis of
the financial aspects of the conversion and integration. We derived this
information from the separate audited financial statements of MasterCard
International as of and for the year ended December 31, 2001 and the audited
financial statements of Europay as of and for the year ended December 31, 2001.
The historical financial information provided for Europay was prepared in
accordance with U.S. GAAP. Refer to Note 19 to the Consolidated Financial
Statements of Europay as of December 31, 2001 and December 31, 2000 and for the
years ended December 31, 2001, 2000 and 1999, for reconciliations in euros of
the historical Europay financial information prepared in accordance with Belgian
GAAP to the information prepared in accordance with U.S. GAAP. The information
is only a summary and you should read it in conjunction with our historical
financial statements and related notes contained elsewhere in this proxy
statement-prospectus.

     MasterCard International's acquisition of Europay will be accounted for
using the purchase method of accounting based upon the estimated value of the
unconditional shares of MasterCard Incorporated being given in exchange for the
shares of Europay on the closing date. The pro forma allocation of the purchase
price to the tangible and identifiable intangible assets acquired and
liabilities assumed is based upon management's estimates, after consultation
with its advisors, of the respective fair values of Europay assets and
liabilities as of September 30, 2001. However, such allocation is preliminary
and is subject to the completion of the conversion and integration. Accordingly,
as discussed below, the final allocation of the purchase price could differ
materially from the pro forma amounts. Identifiable intangible assets other than
goodwill were estimated in accordance with Statement of Financial Accounting
Standards ("SFAS") No. 141, "Business Combinations." The purchase price in
excess of tangible and identifiable intangible assets acquired and liabilities
assumed has been allocated to goodwill. In accordance with SFAS No. 142,
"Goodwill and Other Intangible Assets," goodwill and other intangible assets
resulting from the integration that have indefinite useful lives will not be
amortized.

     At the end of the three-year transition period and on the second
anniversary thereof shares of MasterCard Incorporated will be reallocated among
member-stockholders. Certain member-stockholders of MasterCard Incorporated
whose initial share allocations decrease will return shares to MasterCard
Incorporated, which will deliver shares to member-stockholders whose initial
share allocations increase. MasterCard Incorporated will not receive any net
consideration for these reallocated shares, nor will there be any increase or
decrease in the total amount of shares outstanding.

     The transaction provides that the number of shares allocated to former
shareholders of Europay and MEPUK will increase or decrease at the end of the
transition period as a result of the application of the global proxy formula for
the third year of the transition period. See "Share Allocation and the Global
Proxy." In accounting for the initial purchase price of Europay, MasterCard will
not consider shares above the minimum number of shares allocable to Europay and
MEPUK shareholders at the end of the transition period because only the minimum
number of shares is issued unconditionally at the closing to such shareholders.
Of the 23.76 million shares attributable to the exchange of Europay and MEPUK
shares, 6.15 million shares are conditional shares subject to reallocation at
the end of the transition period and allocable to Europay and MEPUK
shareholders. Europay and MEPUK shareholders are therefore receiving 17.61
million unconditional shares at closing. The value of each MasterCard
Incorporated share, immediately before the exchange, is estimated to be $15.21
based on an independent appraisal. Accordingly MasterCard's purchase price for
the shares of Europay is estimated to be $267.9 million.

     Since former Europay and MEPUK shareholders would retain or receive shares
of MasterCard Incorporated at the end of the transition period without remitting
any additional consideration, any shares retained or received by them that are
above their minimum allocation at that time would constitute part of the

                                        68
<PAGE>

purchase price. Any such additional shares would be valued at that time based
upon the fair value of the stock of MasterCard Incorporated. Any such
reallocation of shares to former Europay and MEPUK shareholders will increase
the purchase price for Europay and, accordingly, the amount of goodwill and
additional paid-in-capital recorded. The unaudited pro forma combined financial
information does not give effect to any potential contingent consideration.

     The unaudited pro forma condensed combined statement of income assumes that
the conversion and integration were effected on January 1, 2001. The unaudited
pro forma condensed combined balance sheet assumes that the conversion and
integration were effected on December 31, 2001.

     The unaudited pro forma combined financial information is presented for
illustrative purposes only. No separate pro forma adjustment is required for the
integration of MEPUK as it will have no assets or liabilities other than shares
in Europay at the close of the transaction. You should not rely on the pro forma
combined financial information as being indicative of the historical results
that would have been achieved had the companies always been consolidated or the
future results that the combined company will achieve after the conversion and
integration.

                                        69
<PAGE>

                            MASTERCARD INCORPORATED

                 UNAUDITED PRO FORMA COMBINED INCOME STATEMENTS
                      (IN THOUSANDS EXCEPT PER SHARE DATA)

<Table>
<Caption>
                                                     FOR THE YEAR ENDED DECEMBER 31, 2001
                                      ------------------------------------------------------------------
                                                                                             PRO FORMA
                                       MASTERCARD                         PRO FORMA          MASTERCARD
                                      INTERNATIONAL    EUROPAY(1)(2)    ADJUSTMENTS(3)      INCORPORATED
                                      -------------    -------------    --------------      ------------
<S>                                   <C>              <C>              <C>                 <C>
REVENUE.............................   $1,773,848        $252,324          $(2,514)(A)       $2,018,477
                                                                            (5,181)(F)

OPERATING EXPENSES
General & administrative............      813,927         131,310           (2,514)(A)          935,731
                                                                            (6,992)(F)

Advertising & market development....      665,846          80,483            1,299(F)           747,628
Depreciation........................       39,680          11,853           (2,234)(B)           49,299
Amortization........................       32,693           5,021            8,906(C)            46,620
                                       ----------        --------          -------           ----------
          Total Operating
            Expenses................    1,552,146         228,667           (1,535)           1,779,278

Other Income and Expense............       11,237          (1,455)             400(E)            10,182
                                       ----------        --------          -------           ----------

INCOME BEFORE INCOME TAXES..........      232,939          22,202           (5,760)             249,381
Income Tax..........................       90,878          10,141           (2,669)(D)           98,867
Cumulative effect of change in                                                 517(F)
  accounting principle, net of
     tax............................           --            (490)                                 (490)
                                       ----------        --------          -------           ----------
NET INCOME..........................   $  142,061        $ 11,571          $(3,608)          $  150,024
                                       ==========        ========          =======           ==========

NUMBER OF SHARES....................                                                            100,000(G)
BASIC AND DILUTED EARNINGS PER
  SHARE.............................          N/A                                            $     1.50(H)
</Table>

          See notes to unaudited pro forma combined income statements.
                                        70
<PAGE>

NOTES TO UNAUDITED PRO FORMA COMBINED INCOME STATEMENTS (IN THOUSANDS)

(1)Euro amounts are translated into U.S. dollars based on a conversion rate of
   1.1172 euros per U.S. dollar, the average exchange rate between U.S. dollars
   and euros for the year ended December 31, 2001.

(2)A reconciliation of the Europay pro forma income statement for the year ended
   December 31, 2001 prepared in accordance with Belgian GAAP to the Europay pro
   forma income statement for the year ended December 31, 2001 prepared in
   accordance with U.S. GAAP as presented is provided below.

<Table>
<Caption>
                                                   BELGIAN    RECONCILING        U.S.
                                                     GAAP        ITEMS           GAAP
                                                   --------   -----------      --------
<S>                                                <C>        <C>              <C>
REVENUE..........................................  $363,563    $(111,239)(a)   $252,324
OPERATING EXPENSES
General & administrative.........................   249,430     (118,120)(b)    131,310
Advertising & market development.................    80,483           --         80,483
Depreciation.....................................     7,252        4,601(c)      11,853
Amortization.....................................     4,671          350(d)       5,021
                                                   --------    ---------       --------
     Total Operating Expenses....................   341,836     (113,169)       228,667
                                                   --------    ---------       --------
Other Income and Expense.........................    (1,224)        (231)(e)     (1,455)
                                                   --------    ---------       --------
INCOME BEFORE INCOME TAXES.......................    20,503        1,699         22,202
Income Tax.......................................     9,608          533(f)      10,141
Cumulative effect of changes in accounting
  principle, net of tax..........................        --         (490)(g)       (490)
                                                   --------    ---------       --------
NET INCOME.......................................  $ 10,895    $     676       $ 11,571
                                                   ========    =========       ========
</Table>

     Adjustments between Belgian GAAP and U.S. GAAP relate to the following:

     (a) REVENUE

         Reconciling items totaling $111,239 that decrease revenue recorded
         under Belgian GAAP to conform with U.S. GAAP include: the elimination
         of revenue relating to transactions under the alliance agreement
         between MasterCard International and Europay, as Europay acts as
         MasterCard's agent rather than a principle in these transactions, of
         $110,507; and the deferral and amortization of licensing fee revenue
         required under U.S. GAAP over the term of the agreement or expected
         period of performance of $732.

     (b)  GENERAL & ADMINISTRATIVE EXPENSES

          Reconciling items totaling $118,120 that decrease general &
          administrative expense recorded under Belgian GAAP to conform with
          U.S. GAAP include: the elimination of expense relating to transactions
          under the alliance agreement between MasterCard International and
          Europay of $110,507; adjustments required to record derivative
          financial instruments at fair value, relating to qualifying hedges
          under Belgian GAAP which are recorded under the accrual method, that
          do not meet the hedge documentation or effectiveness criteria under
          U.S. GAAP of $2,188; the reversal of rental expense due to the
          capitalization of leases under U.S. GAAP of $4,619; a change in
          accounting estimate under U.S. GAAP relating to the modification of
          the lease terms for all existing automobile lease contracts which
          effectively terminated the capital lease agreements resulting in a
          gain of $27; decreased expense relating to the difference between cost
          treatment required under U.S. GAAP and the fair value method used
          under Belgian GAAP for "know-how" contributed as part of initial
          investment equity of $416; decreased expense of $353 relating to the
          change during 2001 in pension benefit cost recorded in accordance with
          SFAS No. 87; differences in net book value of fixed assets arising
          from differences in depreciation methods described below resulting in
          an increased gain on the disposal of fixed assets of $10.

                                        71
<PAGE>

     (c) DEPRECIATION

         Reconciling items totaling $4,601 that increase depreciation expense
         recorded under Belgian GAAP to conform with U.S. GAAP include:
         depreciation of capitalized interest on borrowings and other
         obligations for assets under U.S. GAAP of $87; differences in
         depreciation methods including application of the half-year convention
         method under U.S. GAAP resulting in increased depreciation expense of
         $611; and increased depreciation expense of $3,903 related to lease
         agreements that are recorded as capital leases under U.S. GAAP and as
         operating leases under Belgian GAAP.

     (d) AMORTIZATION

         Reconciling items of $350 that increase amortization expense recorded
         under Belgian GAAP to conform with U.S. GAAP consist of increased
         amortization expense as a result of internally developed software costs
         that are capitalized under U.S. GAAP.

     (e) OTHER INCOME AND EXPENSE

         Reconciling items totaling $231 that reduce other income and expense
         under Belgian GAAP to conform with U.S. GAAP include: decreased
         interest expense of $40 due to the capitalization of interest on
         borrowings and other obligations for assets under U.S. GAAP; and
         increased interest expense on leases required to be recorded as capital
         leases under U.S. GAAP, net of gains recorded on the termination of
         capital leases under U.S. GAAP due to the revision of lease terms, of
         $271.

     (f) INCOME TAX

         Reconciling item of $533 that increases income tax under Belgian GAAP
         to conform with U.S. GAAP relates to the tax impact of reconciling
         items.

     (g) CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING PRINCIPLE, NET OF TAX

         Reconciling item of $490 represents a cumulative effect adjustment to
         net income to recognize at fair value all derivative instruments that
         were designated as cash flow hedging instruments upon adoption of
         Statement of Financial Accounting Standard ("SFAS") No. 133/138,
         "Accounting for Derivative Instruments and Hedging Activities".

         For a more detailed explanation of the nature of the Belgian GAAP to
         U.S. GAAP reconciling items see Note 19 to the Consolidated Financial
         Statements of Europay as of December 31, 2001 and December 31, 2000 and
         for the years ended December 31, 2001, 2000 and 1999 included elsewhere
         in this proxy statement-prospectus.

(3) The pro forma financial statements have been prepared to reflect the
    conversion of MasterCard International from a member-based organization to a
    stock company and the integration of Europay, MEPUK and MasterCard. No
    separate pro forma adjustment is required for the integration of MEPUK as it
    will have no assets or liabilities other than shares in Europay at the close
    of the transaction. Pro forma adjustments are made to reflect:

     (A) the elimination of inter-company revenues and expenses between
         MasterCard and Europay.

     (B)  the change in annual depreciation resulting from adjustments made to
          the estimated useful lives of property acquired (ranging from three to
          thirty years).

     (C) additional annual amortization of certain intangible assets resulting
         from the acquisition consisting primarily of software and other
         technology-related intangibles and trademarks, which are being
         amortized over their estimated useful lives ranging from three to five
         years. In accordance with SFAS No. 142, goodwill and other intangible
         assets resulting from the integration that have indefinite useful lives
         will not be amortized.

     (D) the income tax effect of the pro forma adjustments. This is calculated
         using a 40% tax rate.

     (E)  the elimination of the reduction on Europay's income statement of the
          minority interest in EPSS held by MasterCard.

                                        72
<PAGE>

     (F)  the consolidation of Maestro and EMV Co., entities to be under the
          control of the combined company. Previously, Maestro and EMV Co. were
          accounted for under the equity method. Europay and MasterCard each
          owned 50% and 33 1/3% of Maestro and EMV Co., respectively. As neither
          MasterCard nor Europay exercised control over Maestro or EMV Co.,
          these investments were not consolidated prior to the integration.

     (G) the issuance of stock by MasterCard to its members.

     (H) net income attributable to European and non-European
         member-stockholders before and after integration with Europay (dollars
         in millions):

<Table>
<Caption>
                                                                         POST-
                                                                    INTEGRATION(D)
                                                 PRE-INTEGRATION        AT 26%            CHANGE
                                                 ---------------    ---------------    -------------
<S>                                              <C>       <C>      <C>       <C>      <C>       <C>
     NET INCOME FOR THE YEAR ENDED DECEMBER 31,
       2001 ATTRIBUTABLE TO:
       Non-European members-stockholders of
          MasterCard(a)........................   $134       87%     $111       74%    $(23)     (17)%
       European members-stockholders(b)........     20       13%       39       26%      19       95%
                                                  ----      ---      ----      ---     ----
                                                  $154      100%     $150      100%    $ (4)(c)
                                                  ====      ===      ====      ===     ====
</Table>

     --------------------
     (a) The net income (pre-integration) attributable to non-European members
         of MasterCard is approximately 93% of MasterCard's net income and
         approximately 15% of Europay's net income.

     (b) The net income (pre-integration) attributable to European members of
         MasterCard is approximately 7% of MasterCard's net income and
         approximately 85% of Europay's net income.

     (c) Decreased consolidated net income is primarily due to additional
         amortization of intangible assets.

     (d) Net income attributable to European and non-European
         member-stockholders after the integration with Europay, giving effect
         to possible increased share allocations to European member-stockholders
         at the end of the transition period:

<Table>
<Caption>
                                                   POST-                               POST-
                                                INTEGRATION       CHANGE FROM       INTEGRATION       CHANGE FROM
                                                 AT 33 1/3%     PRE-INTEGRATION        AT 44%       PRE-INTEGRATION
                                                ------------    ----------------    ------------    ----------------
        <S>                                     <C>     <C>     <C>        <C>      <C>     <C>     <C>        <C>
        NET INCOME FOR THE YEAR ENDED DECEMBER
          31, 2001 ATTRIBUTABLE TO:
        Non-European member-stockholders of
          MasterCard(a).......................  $100     67%     $(34)      (25)%   $ 84     56%     $(50)      (37)%
        European member-stockholders(b).......    50     33%       30       150%      66     44%       46       230%
                                                ----    ---      ----               ----    ---      ----
                                                $150    100%     $ (4)(c)           $150    100%     $ (4)(c)
                                                ====    ===      ====               ====    ===      ====
</Table>

                                        73
<PAGE>

                            MASTERCARD INCORPORATED

                   UNAUDITED PRO FORMA COMBINED BALANCE SHEET
                            AS OF DECEMBER 31, 2001
                                 (IN THOUSANDS)

<Table>
<Caption>
                                                                                             PRO FORMA
                                          MASTERCARD                       PRO FORMA         MASTERCARD
                                         INTERNATIONAL   EUROPAY(1)(2)   ADJUSTMENTS(3)     INCORPORATED
                                         -------------   -------------   --------------     ------------
<S>                                      <C>             <C>             <C>                <C>
ASSETS
Cash and cash equivalents..............   $  176,143       $ 83,550        $   2,176(D)      $  261,869
Investment securities..................      494,243             --               --            494,243
Property, plant & equipment............      159,742         45,469            8,377(A)         213,929
                                                                                 341(D)

Other assets...........................      547,923        144,034          (16,063)(A)        646,745
                                                                             (14,699)(B)
                                                                              (4,407)(C)
                                                                             (10,043)(D)

Intangible assets......................       96,754         19,914          305,093(A)         421,761
                                          ----------       --------        ---------         ----------
          TOTAL ASSETS.................   $1,474,805       $292,967        $ 270,775         $2,038,547
                                          ==========       ========        =========         ==========
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities....................   $  638,471       $217,466        $ (14,699)(B)     $  871,220
                                                                              (7,755)(D)
                                                                              37,737(E)

Long-term liabilities..................      229,673         17,445           41,161(E)         288,279
                                          ----------       --------        ---------         ----------
          TOTAL LIABILITIES............      868,144        234,911           56,444          1,159,499
Minority interest......................           --          2,691              230(D)             230
                                                                              (2,691)(F)
STOCKHOLDERS' EQUITY
Common stock...........................           --             --            1,000(G)           1,000
Paid-in-capital........................           --         17,832          250,024(A)         873,881
                                                                             601,724(G)
                                                                               4,301(I)

Retained earnings......................      602,724         39,049         (602,724)(G)             --
                                                                             (39,049)(H)

Accumulated other comprehensive income
  (loss)...............................        3,937         (1,516)           1,516(H)           3,937
                                          ----------       --------        ---------         ----------
          TOTAL STOCKHOLDERS' EQUITY...      606,661         55,365          216,792            878,818
                                          ----------       --------        ---------         ----------
          TOTAL LIABILITIES &
            STOCKHOLDERS' EQUITY.......   $1,474,805       $292,967        $ 270,775         $2,038,547
                                          ==========       ========        =========         ==========
</Table>

            See notes to unaudited pro forma combined balance sheet.
                                        74
<PAGE>

NOTES TO UNAUDITED PRO FORMA COMBINED BALANCE SHEET (IN THOUSANDS EXCEPT PER
SHARE DATA)

(1)Euro amounts are translated into U.S. dollars based on a conversion rate of
   1.1366 euros per U.S. dollar, the period end exchange rate between U.S.
   dollars and euros as of December 31, 2001.

(2)A reconciliation of the Europay pro forma balance sheet as of December 31,
   2001 prepared in accordance with Belgian GAAP to the Europay pro forma
   balance sheet as of December 31, 2001 prepared in accordance with U.S. GAAP
   as presented is provided below.

<Table>
<Caption>
                                            BELGIAN     RECONCILING       U.S.
                                              GAAP         ITEMS          GAAP
                                            --------    -----------     --------
<S>                                         <C>         <C>             <C>
ASSETS
Cash and cash equivalents.................  $ 83,550           --       $ 83,550
Investment securities.....................        --           --             --
Property, plant & equipment...............    29,956       15,513(a)      45,469
Other assets..............................   151,923       (7,889)(b)    144,034
Intangible assets.........................    19,417          497(c)      19,914
                                            --------     --------       --------
     TOTAL ASSETS.........................  $284,846     $  8,121       $292,967
                                            ========     ========       ========
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities.......................  $229,782     $(12,316)(d)   $217,466
Long-term liabilities.....................     4,807       12,638(e)      17,445
                                            --------     --------       --------
     TOTAL LIABILITIES....................   234,589          322        234,911
                                            --------     --------       --------
Minority interest.........................     2,691           --          2,691
STOCKHOLDERS' EQUITY
Common stock..............................        --           --             --
Paid-in-capital...........................    17,832           --         17,832
Retained earnings.........................    29,734        9,315         39,049
Accumulated other comprehensive income
  (loss)..................................        --       (1,516)(f)     (1,516)
                                            --------     --------       --------
     TOTAL STOCKHOLDERS' EQUITY...........    47,566        7,799         55,365
                                            --------     --------       --------
     TOTAL LIABILITIES & STOCKHOLDERS'
       EQUITY.............................  $284,846     $  8,121       $292,967
                                            ========     ========       ========
</Table>

     Adjustments between Belgian GAAP and U.S. GAAP relate to the following:

     (a) PROPERTY, PLANT AND EQUIPMENT

     Reconciling items totaling $15,513 that increase property, plant and
     equipment recorded under Belgian GAAP to conform with U.S. GAAP include:
     the capitalization of borrowing costs of $2,078; differences in
     depreciation methods including application of the half-year convention
     method under U.S. GAAP totaling $5,187; and the capitalization of capital
     leases of $8,248.

     (b) OTHER ASSETS

     Reconciling items totaling $7,889 that decrease other assets recorded under
     Belgian GAAP to conform with U.S. GAAP include: an adjustment to net the
     receivable recorded under Belgian GAAP for a disputed tax assessment
     against the related liability of ($14,850); prepaid pension assets of $609;
     deferred tax assets of $2,420; adjustments to record derivative financial
     instruments at fair value $4,205; the difference between cost treatment
     required under U.S. GAAP and fair value used under Belgian GAAP of
     "know-how" contributed as initial investment equity of ($499); and $226
     related to a loss in value on an investment accounted for under the equity
     method that was deemed other than temporary.

                                        75
<PAGE>

     (c) INTANGIBLE ASSETS

     Reconciling items totaling $497 that increase intangible assets recorded
     under Belgian GAAP to conform with U.S. GAAP are comprised of
     capitalization of internally developed software costs of $497.

     (d) CURRENT LIABILITIES

     Reconciling items totaling $12,316 that decrease current liabilities
     recorded under Belgian GAAP to conform with U.S. GAAP include: an
     adjustment to net the liability recorded under Belgian GAAP for a disputed
     tax assessment against the related receivable of ($14,850); adjustments to
     record derivative financial instruments at fair value of ($184); net
     present value of minimum lease obligations under capital leases of $1,754;
     and deferred licensing fee revenue of $964.

     (e) LONG-TERM LIABILITIES

     Reconciling items totaling $12,638 that increase long-term liabilities
     recorded under Belgian GAAP to U.S. GAAP include: deferred tax liabilities
     of $4,920; net present value of minimum lease obligations under capital
     leases of $2,660; and deferred licensing fee revenue of $5,058.

     (f) OTHER COMPREHENSIVE INCOME (LOSS)

     Reconciling items totaling ($1,516) include the effective portion of fair
     value changes on derivative financial instruments designated as a cash flow
     hedge of $4,450; and the impact of foreign currency translation of
     ($5,966).

    For a more detailed explanation of the nature of the Belgian GAAP to U.S.
    GAAP reconciling items see Note 19 to the Consolidated Financial Statements
    of Europay as of December 31, 2001 and December 31, 2000 and for the years
    ended December 31, 2001, 2000 and 1999 included elsewhere in this proxy
    statement-prospectus.

(3) The pro forma financial statements have been prepared to reflect the
    conversion of MasterCard from a member-based organization to a stock company
    and the integration of Europay, MEPUK and MasterCard. No separate pro forma
    adjustment is required for the integration of MEPUK as it will have no
    assets or liabilities other than shares in Europay at the close of the
    transaction. Pro forma adjustments are made to reflect:

     (A) intangible assets arising out of the preliminary allocation of purchase
price as follows:

<Table>
         <S>                                                           <C>        <C>
         Purchase price (see Note 3(J)).......................................    $267,856
         Allocated as follows:
           Historical book value of 85% of Europay's assets and
              liabilities............................................  $49,347
           Step-up of the fair value of assets:
              Software and other technology-related intangibles......   29,878
              Trademarks, tradenames and brand names.................   11,900
              Property, plant and equipment..........................    8,377
           Deferred income taxes.....................................  (16,063)
           Liabilities and acquisition related costs (see Note
              3(E))..................................................  (78,898)
         Excess of purchase price over identifiable assets and liabilities
           (goodwill and customer relationships)..............................    $263,315
                                                                                  ========
</Table>

          Total intangible assets amount to $305,093 and consist of customer
          relationships of $176,928; goodwill of $86,387; software and other
          technology-related intangibles of $29,878; and trademarks, tradenames
          and brand names of $11,900. See Note 3(C) to the Notes to the
          Unaudited Pro Forma Combined Income Statements for amortization
          period.

     (B) the elimination of inter-company balances between MasterCard and
         Europay.

                                        76
<PAGE>

     (C) the elimination of MasterCard's historical investment of $4,407 for
         12.25% of Europay and 15% of EPSS (representing 15% of Europay on a
         consolidated basis).

     (D) the consolidation of Maestro International and EMV Co., entities under
         the control of the combined company.

     (E) acquisition related costs including the costs of acquiring and
         eliminating certain Europay brands and logos totaling $39,700;
         professional fees relating to the transaction totaling $12,200;
         severance costs for Europay employees totaling $10,000; costs of
         eliminating redundant European computer systems totaling $6,400; $8,000
         relating to certain other acquisition liabilities; and other
         miscellaneous costs totaling approximately $2,600. See Note 3(A).

     (F) the elimination of the reduction on Europay's balance sheet of the
         minority interest in EPSS held by MasterCard.

     (G) the conversion of MasterCard International from a member-based
         institution to a stock corporation and the issuance of 100 million
         shares of class A redeemable and class B convertible common stock of
         MasterCard Incorporated at a par value of $.01 per share to the
         MasterCard International principal members and the Europay and MEPUK
         shareholders.

     (H) the elimination of Europay's pre-acquisition retained earnings and
         paid-in-capital.

     (I) the equity pick-up resulting from the change of MasterCard
         International's method of accounting for the Europay investment from
         historical cost to consolidation. Amount was reclassified from
         MasterCard International's retained earnings upon conversion.

     (J) an independent appraisal valued the shares of MasterCard Incorporated
         at $1.091 billion before the transaction. In the transaction, 66.67
         million shares will be issued to non-European members and 33.33 million
         shares will be issued to European members. As a result of negotiations
         between the parties, approximately 27.96 million shares will be issued
         to Europay and MEPUK stockholders and 5.37 million shares will be
         issued to European members who are not Europay or MEPUK stockholders.
         Europay and MEPUK stockholders will receive 4.2 million shares for the
         conversion of their membership interests and the remaining 23.76
         million shares are attributable to the exchange of their Europay and
         MEPUK shares. The transaction provides that the number of shares
         allocated to former shareholders of Europay and MEPUK will increase or
         decrease at the end of the transition period as a result of the
         application of the global proxy formula for the third year of the
         transition period. See "Share Allocation and the Global Proxy." In
         accounting for the initial purchase price of Europay, MasterCard will
         not consider shares above the minimum number of shares allocable to
         Europay and MEPUK shareholders at the end of the transition period
         because only the minimum number of shares is issued unconditionally at
         the closing to such shareholders. Of the 23.76 million shares
         attributable to the exchange of Europay and MEPUK shares, 6.15 million
         shares are conditional shares subject to reallocation at the end of the
         transition period and allocable to Europay and MEPUK shareholders.
         Europay and MEPUK shareholders are therefore receiving 17.61 million
         unconditional shares at closing. Immediately before the integration,
         the value of each MasterCard share will be approximately $15.21 based
         upon an independent appraisal ($1.091 billion divided by 71.71 million
         shares). Accordingly, MasterCard's purchase price for the shares of
         Europay is estimated to be $267.9 million ($15.21 per share multiplied
         by 17.61 million shares). Since former Europay and MEPUK shareholders
         would retain or receive shares of MasterCard Incorporated at the end of
         the transition period without remitting any additional consideration,
         any shares retained or received by them that are above their minimum
         allocation at that time would constitute part of the purchase price.
         Any such additional shares would be valued at that time based upon the
         fair value of the stock of MasterCard Incorporated. Any such
         reallocation of shares to former Europay and MEPUK shareholders will
         increase the purchase price for Europay and, accordingly, the amount of
         goodwill and additional paid-in-capital recorded.

                                        77

</TEXT>
</DOCUMENT>
</SUBMISSION>
